1920-03-30

[Stage Direction]
Sir HENRY DRAYTON (Minister of Finance) moved for leave to introduce Bill No. 38, to amend the Trust Companies Act, 1914.
Mr. MACKENZIE KING:: Explain.


Sir HENRY DRAYTON:: The object of the Bill is to provide for an inspection of these companies, there being none at present. There is a provision in the existing Act under which the Minister of Finance may, if he so desires, have an inspection made of any particular company. He is not in a position, however, to know what companies should or should not be inspected; and complaints are not made about companies until something is wrong with them, when inspection is generally too late. Trust and loan companies' will both be made subject to inspection because I shall introduce in a moment another Bill dealing with the latter class. The new legislation will place
both trust and loan companies in exactly the same position as insurance companies. An annual inspection is provided for because only by an annual inspection is it possible for any one to tell when special examinations ought to be made.


[Stage Direction]
Motion agreed to, and Bill read the first time.

[Stage Direction]
Sir HENRY' DRAYTON (Minister of Finance) moved for leave to introduce Bill No. 39, to amend the Loan Companies Act, 1914.
Motion agreed to, and Bill read the first time.

[Stage Direction]
Hon. C. C. BALLANTYNE (Minister of Marine) moved that to-morrow the House do resolve itself into Committee of the Whole to consider a proposed resolution to amend part VII of the Canada Shipping Act, chapter 113 of the Revised Statutes relating to .steamboat inspection.

[Stage Direction]
Hon. Mr. BALLANTYNE (Minister of Marine) gave notice that to-morrow he would move in Committee of the Whole a resolution to amend the Fish Inspection Act, chapter 45 of the statutes of 914, extending the provisions of the Act to pickled herring, ale-wives, mackerel, and salmon, other than mild cured salmon, and the containers in which such fish are packed and marketed, etc.

[Stage Direction]
On the Orders of the Day:
Mr. I. E. PEDLOW (South Renfrew):: Air. Speaker, I would like to ask the Government a question of supreme importance at the present time. I noticed in a recent issue of the Toronto Globe a reference made to some correspondence that had passed between the Acting Premier of the Dominion and the Premier of Ontario regarding certain representations forwarded, on behalf of the Armenian people, by the Canadian Government to the Imperial authorities, and by the latter to the Supreme Council of the League of Nations. I would like to know the tenor and nature of the representations made and which, according to press rejwrts, have been endorsed by the Premier of Ontario.


Rt. Hon. Sir GEORGE FOSTER (Acting Prime Minister):: I may say to my hon. friend that the general tenor of the representations made to the Supreme Council of the League of Nations through the Imperial Government was along the lines of securing by the making and operation of the Treaties of Peace, immunity for Armenian communities from oppression and massacre and the elimination of Turkish authority as far as they are concerned.


Mr. McMASTER:: Hear, hear.



CONDITION OF IRELAND.

[Stage Direction]
On the Orders of the Day:
Isaac Ellis Pedlow: I would also like to ask if it is the intention of the Dominion Government to make similar representations through -the Imperial Government to the Supreme Council of the League of Nations with regard to the deplorable conditions which, accor-ding to press reports, obtain at the present time in Ireland, and if not, why not.


Some hon. MEMBERS:: Oh, oh.


Sir GEORGE FOSTER:: I may say that on the grounds stated by the hon. gentleman in his question, as to whether it is the intention of the Government to make similar representations to the same authority, that taking into consideration the essential difference between the two cases, both as to the conditions and jurisdiction, it is emphatically not the intention of the Government to make such similar representations.



ST. LAWRENCE SHIP CHANNEL-ICE CONDITIONS.

[Stage Direction]
On the Orders of the Day:
Mr. JOSEPH ARCHAMBAULT (Chambly-Vercheres):: I regret to have to again call the attention of the House to a most important and urgent question, I refer to the ice jam on the St. Lawrence river. On the 9th of March I drew the attention of the Minister of Marine to the condition in question; stating that I had been informed from reliable sources that there was imminent danger of floods. The minister then answered to the following effect:
X am afraid that the information that has reached the hon. member is not accurate.* * * With no ice bridge formed at this point, there is no fear of disastrous floods occurring above. The channel is now clear of ice up to a point near Portneuf. 35 miles above Quebec, where the Lady Grey is working to-day, and is making good progress.
j do not anticipate any serious results from floods this spring-no one can accurately tell-but I am pleased to say that the Lady Grey is working so well and that the ice bridge is broken.

I have no doubt that the minister was sincere and in earnest in his statement but I believe he has been wrongly informed. In the Montreal Gazette of Friday, March 26 it is stated that at Three Rivers the ice barrage is still solid and trouble is feared as the water continues to rise gradually in the St. Lawrence. It is also reported that the ice barrage at Three Rivers is still solid clear across to the South shore, and that the Lady Grey will not be able to break through the ice that blocks the river for miles above this point.
In the reports of the Press yesterday-


Mr. SPEAKER:: Order. The hon. member is bringing to the attention of the House a matter of undoubted public importance, but he is proceeding to make out a case which he ought not to do upon the Orders of the Day. The hon. member can summarize his question so as to get the answer he desires without going into the matter by way of argument.


Joseph Archambault: I bow to your
decision, Mr. Speaker. I was going to state that the report I read was dated Friday, and on Monday we had some further reports in the Montreal Gazette and the Montreal Star to the effect that the ice barrage was worse, that the water was rising, and that there was even-


Some hon. MEMBERS:: Order.


Joseph Archambault: *-and that even some of the Government shipbuilding, plants were carried away by the flood. I would like to know if the minister, (Mr. Ballantyne) is informed of these conditions, and if he intends to do anything to relieve them.


Hon. Mr. BALLANTYNE (Minister of Marine):: Mr. Speaker, in answer to the
hon. member for Chambly-Vereheres (Mr. Archambault) I. cannot to-day give him information very much different from that which I furnished him a few days ago. I took occasion this morning to inquire of the officers who have charge of the icebreaking operations how the ice-breaker Lady Grey was getting on, and I was informed that she is now up the river quite a distance this side of Portneuf, and that the river was quite clear of ice from Loth-biniere down to Quebec. Of course, I cannot state definitely that there will not be a flood, but forming my opinion on what has occurred in previous years, neither myself nor the officers connected with ice-breaking think there is any imminent danger of floods occurring this year.

The hon. member has referred to the height of the water at Three Rivers. As a matter of fact it is not very much higher than what it has been in former years. The particular shipyard that he refers to, that of the Tidewater Shipbuilding Company, is located at a spot which is always flooded in the spring. So far as I can prophesy, Mr. Speaker, I do not think that people along the South shore need be unduly alarmed as to the possibility of a great flood.


Joseph Archambault: If the hon. minister would permit me, the report also states that the Lady Grey has had to go back to Quebec for repairs.


Mr. BALL  ANTYNE@: The news I got
about two hours ago was to the effect that the Lady Grey was at Poi'tneuf.



CANADIANS IN THE IMPERIAL SER-VICE-CAPT. JOHN A. BARRON.

[Stage Direction]
On the Orders of the Day:
Mr. H'. B. MORPHY (North Perth): Mr. Speaker-
Mr. POWER:: Mr. Speaker, in view of
the very interesting discussion in regard-


Edgar Nelson Rhodes: The hon. member for
Perth has the floor.


Mr. MORPHY:: I desire to bring to the
notice of the Government, Mr. Speaker, a despatch appearing in the Citizen of Saturday morning last, entitled " Canadian in Berlin." It states:
The continued disturbance in Germany, more particularly in Berlin, as a result of the revolutions and counter revolutions, have a decidedly local interest to Stratford, inasmuch as Captain John A. Barron, R.A.F., son of His Honour Judge Barron, is now and has been for some weeks at Berlin, the chief centre of the disturbances. As one of the entente officers selected by the allies to adjust certain claims upon the Germans, in relation to Zeppelins and airships, he was required to meet with German officers, and it is seen by the press that the reception by the latter was far from cordial, in fact at times it assumed the shape of aggressive force, and one at least of the French officers had died as the result of these attacks, and others have been injured. For some time Captain Barron has not been heard from by his friends in Ottawa.
I would like to ask the Government two questions:	(1) Has the Government any
system of keeping tab upon Canadians in the Imperial service? (2) Has the Government received any report in regard to the dangerous situation in which this Canadian is placed?


George Eulas Foster: The first question, as I
understand it, is as to whether there is any system by which the Canadian Government keeps track of Canadians in the Imperial service. That is looked after by the Imperial authorities themselves, and information can be got by application from Ottawa to the authorities in London with reference to any particular case. The second question I did not hear.
I am informed by the Minister of Militia (Mr. Guthrie) that a cable has been sent to the Imperial authorities for information, but that no reply has yet been received.



INQUIRY FOR RETURNS.

[Stage Direction]
On the Orders of the Day: '
Mr. J. H. SINCLAIR (Antigonish and Guysborough):: Mr. Speaker, some days ago I drew the attention of the leader of the Government to the fact that, a mass of information moved for at the last session by members of the Opposition have not been furnished. I was asked to furnish particulars. I have looked over the records and I find forty-eight motions were made by members of the Opposition last year that have not yet been complied with. I handed the list to the leader of the Government and asked him to put the matter in the hands of the proper officer for action, as some of these returns are urgently needed by members of the Opposition.


George Green Foster: I think I said to my hon. friend when he put the question before that if he would send me a list I would look into the matter. I have since had that list. I would beg hon. ^members to be a little merciful and patient considering the shower of orders for returns and questions for information that are being received. It is a hard tax on the resources of the departmental staffs, but the arrears are being overtaken as. quickly as possible.



CLOSING OF DISTRICT PENSION OFFICES.

[Stage Direction]
On the Orders of the Day:
Hon. NEWTON W. ROWELL (President of the Privy Council):	The hon. member
for Quebec South (Mr. Power) inquired on Thursday last as to the accuracy of the rumour that the district Pension Office at Quebec,and at certain other cities had been or were about to be closed, and I promised to secure information on the subject. I am now advised by the Chairman of the Board of Pension Commissioners that the board has decided to close the district Pension
m\r\rnvs
Office at Quebec and some fourteen other district offices throughout Canada. The statement by the Chairman of the board is as follows:
District Offices were originally opened for the purpose of investigating applications for pensions made 'by dependent parents. There was no thought in the beginning of performing any medical work in connection with the District Offices. The medical work was all performed by military Medical Boards. After the armistice the cases of dependent parents for investigations immediately became very few in number but the medical work in connection with de^ mobilization became very heavy. The medical work was, therefore, taken out of the hands of the military Medical Boards and doctors were sent from head office to each of the district offices to make medical re-examinations, etc. At the present time a district office exists mainly to re-examine disability cases from time to time.
About eight months ago it was realized that District Offices would eventually have to be closed and in order to make this possible a scheme of travelling Medical Boards was originated to re-examine pensioners in all centres where a number could be brought together at a particular time, that is to say in towns of a population of two thousand or more. This travelling medical board scheme is now in operation in the Eastern Provinces and is ready to be put into operation in the Western Provinces. The result is that pensioners attached to the Charlottetown and Sydney District Offices are being re-examined by travelling Medical Boards from Halifax; those attached to Quebec by travelling Medical Boards from Montreal; those attached to Kingston and North Bay by travelling Medical Boards from Toronto ; those attached to Windsor by travelling (Medical Boards from London and those attached to Port Arthur by travelling Medical Boards from Winnipeg. Travelling Medical Boards will also, in the near future, deal with pensioners attached to Regina, Saskatoon, Victoria, St. John and possibly Hamilton. As soon as these travelling Medical Boards have been in operation for a month or two the necessity for keeping offices open in all the smaller cities will no longer exist.
At the present time there are twenty-one District Offices which cost this commission an average of over one hundred thousand dollars a month, that is to say more than two-thirds the total cost of administration. Of course the smaller District Offices cost this commission proportionately less in accordance with their size but the closing of each of these offices will result in a saving of not less than five thousand dollars a year for the smallest District Office, namely Charlottetown, and not less than thirty thousand dollars a year for some of the medium-sized District Offices which it is proposed to close.
It is estimated that the closing of offices which can now be dispensed with will mean an annual saving of between $400,000 and $500,000 in the administration of the Pensions Board.	,
With reference particularly to the Quebec District Office, this office has, from the time it was opened, has been extraordinarily expensive when its size is considered. There are less than one thousand pensioners resident in the Quebec district which takes in the north shore of the 
St. Lawrence from Three Rivers and the south shore from Levis east. The office has been reorganized on two occasions but is still the most expensive of this commission when its size is considered. For the eleven months just past the expenditure in connection with this office has been about $23,000. By closing the office and doing the re-examinations of pensioners by the travelling Medical Board from Montreal it is thought that at least three-quarters of this expenditure can be saved and the service to the pensioner will be quite as good.
The same thing, although perhaps to not as great an extent, can be said with regard to the District Offices which it is proposed to close.
That, Mr. Speaker, is the statement of the Chairman of the Board of Pension Commissioners as to the action which the Board has taken and is about to take and the reasons therefor. The Board is convinced that by adopting this course efficient service can be given to the pensioners and at the same time the very large sum mentioned can be, saved annually to the country. Members of the House know that the Board is constituted by statute and that its members are carrying out their duties under that statute.

[Stage Direction]
On the Orders of the Day:
Charles Gavan Power: In view of the discussion with regard to the ice jam on the St. Lawrence and the apparent impossibility of navigation about Port-neuf, may I ask the Minister of Marine and Fisheries if he intends to look .into the request of the Quebec Board of Trade with reference to loading with Canadian grain and foodstuffs the four Government boats now lying in Quebec harbour?
Hon, C. C. BALLANTYNE (Minister of Marine): The operation of the Government boats is under the management not of the Department of Marine but of Canadian Government Merchant Marine, Limited. The Government in no way interferes with or exercises authority over the routes followed or the cargoes carried by these boats.
I am sorry that I am not in a position to give the hon. member any information.


Charles Gavan Power: May	my question be
directed to the Minister of Railways?


Hon. J. D. REID (Minister of Railways):: The same answer will apply.



HOUSE OF COMMONS OFFICIALS- ORGANIZATION.

[Stage Direction]
On the Orders of the Day:
Mr. J. A. C. ETHIER (Laval-Two Mountains) :: I understand that Mr. Speaker is

to report to the House a plan of re-classification >of the staff of the House, including the translators, who, I gather from the discussion which took place last week, are under the control of Mr. Speaker and the Debates Committee. May I ask whether you intend, Mr. Speaker, to submit that report some time this week?


Edgar Nelson Rhodes: It was my purpose to
have brought down the plan of organization during the latter portion of last week, hut after a conference with the member for Wright (Mr. Devlin), it was thought better to defer it until Tuesday of this week. So far as I can give an assurance at the moment, it will be brought down to-morrow without fail.


Joseph Arthur Calixte Éthier: Is it the intention to refer that plan or that report to a Special Committee of the House or to the Committee of the Whole?


Edgar Nelson Rhodes: On two previous occasions the matter was dealt with through a motion placed upon the Order Paper by the Prime Minister. I do not know that any advantage can be gained by referring the matter to a special committee, but of course that is a question entirely for the House to decide.


Joseph Arthur Calixte Éthier: I suggest, if I may be permitted, that a committee be appointed to report upon the matter to the House.


Edgar Nelson Rhodes: That can be dealt with
when the organization scheme is before the House.



OVERFLOWING OF THE RIVER ST.

[Stage Direction]
On the Orders of the Day:
Air. D. A. LAFORTUNE (Jacques Cartier) (translation):: Mr. Speaker, may I be permitted to ask the Government whether they have been infoimed that the floods of the river St. Peter are a cause of serious loss to the inhabitants of that part of the constituency I represent. I have just learned from a large number of my constituents that the river is overflowing at the present time, flooding many a hundred dwellings. Two or three feet of water cover the ground to the great injury and discomfort of the dwellers. 1 understand that the river is under the care, supervision and jurisdiction of the Dominion Government. If that be true, I would suggest to the hon. minister in charge of that department the desirability of losing no time in safeguarding the interests of those constituents, landlords and
tenants. Mr. Speaker, your humble servant would pray for an immediate answer, even if it be in English.
The right hon. C. J. DOHERTY (Minister of Justice): I was surprised to hear the hon. member from Jacques Cartier (Air. Lafortune) state that the river St. Peter is under the jurisdiction of the Dominion Government. I have no knowledge that the supervision of water courses was one of the many attributes of the Government. If l am correctly, informed, what is known as St. Peter's river is rather a brook which at times overflows. I shall inquire whether the waters of that small stream are under the jurisdiction of the Government or not and if it is within our powers to prevent their overflowing. The hon. member may rest assured that I shall inquire immediately into the matter.



GOVERNMENT RAILWAY SYSTEAI.


[Stage Direction]
On the motion for Committee of Supply Hon. J. D. Reid (Minister of Railways and Canals) moved: '
That the Speaker do now leave the Chair for the House to so into Committee of Supply.
William Lyon Mackenzie King: I do
not desire to delay the House going into Supply, but I should like to point out to the Government that the explanatory details which are usually given in regard to civil government have not yet been brought down, and until they are, I think we should defer taking, up that part of the Supply.


John Dowsley Reid: When we are in
Supply, I shall not ask the committee to take up Civil Government to-day, but I shall be pleased to take up some Estimates other than Civil Government.
Air. Speaker, when the House resolves itself into Committee of Supply to-day, it is my intention to take up the Railways and Canals Estimates. It has been the custom to present an annual statement as to the operation of the Canadian Government railways. In presenting the Estimates of the Department of Railways and Canals for the forthcoming fiscal year, I desire to place before the House a statement dealing with the operation of the Canadian National Railways for the calendar year 1919. The Canadian Northern was merged with the Government railways in December, 1918, so that we are now in a position to review one completed year of operation under nonpolitical and purely business auspices. The
8G0

National system, with which we are now dealing, comprises the following lines:'-
Miles.
Canadian Northern railway system 9,479
Intercolonial	 1,592
Prince Edward Island	[DOT]	..	278
National Transcontinental	2,002
Branch lines	 376
Total	13,727
It is unfortunate that abnormal economic conditions, the disturbing effects of which are world-wide and beyond the control of any railroad management, whether public or private, should have prevented a better showing for the first year of large scale national operation, but the result, when .closely analysed, is not without hope for the future of Government ownership and operation.
More Revenue but Greater Operating Costs.
Briefly stated, the National system comprising
The Canadian Northern,
The Intercolonial, and The Transcontinental,
earned $94,000,000 during the year, or almost $12,000,000 more than during 1918. But even with the $12,000,000 increased earnings, the operating' loss is $14,000,000, made up as follows:
Canadian Northern	$6,500,000
Intercolonial and Transcontinental	 7,500,000

The explanation of this is that during the year the operating expenses advanced from 84 to practically 108 millions, an adverse increase of nearly 24 millions. For the most part, this was due to advances in wages under the McAdoo award and supplements thereto, which were not offset by corresponding increases in rates. There was no rate increase during 1919. Given the same operating costs as 1918, the earnings for 1919 would have taken care of them and provided in addition the tidy sum of nine millions towards meeting fixed charges. These interest obligations in themselves amount to nineteen millions, and, singularly enough, a comparison of the payroll of the National system for the two years shows an increase of practically nineteen millions in wages alone during 1919.
The operating loss of fourteen millions, and the consequent failure to provide for fixed charges, is really a reflection of conditions which obtain all over the world as a result of the war. Comparisons are seldom

conclusive, but sometimes they are illuminating, and in passing, I am reminded that in the United States, where economic con- ' ditions so closely approximate our own. the lines taken over by the Government for operation during the war are reported to have failed in two years by over seven hundred millions to earn the net revenue which the Government guaranteed them when taken over by the United States Railroad Administration.
More Passengers but Less Freight.
Although the freight earnings of the National system show an increase in excess of two and a half millions for the year, there was a falling off in freight handled amounting to three million tons. This was due in part to the stoppage of munition shipments on cessation of hostilities, and four-fifths of the decreased tonnage was on the old Canadian Government system, which formerly handled so much war business. There was a noticeable falling off also in -westbound business, due to unsettled conditions in the period of transition from war to peace. That there was an increase in freight earnings at all is attributable to the increased rates put into effect during 1918, to which 1 shall refer more fully later on. Had the volume of freight handled during the preceding year been maintained, the increased freight earnings would have amounted to seven and a half millions instead of two and a half. Thus the return of the world to a peace basis may be said to have cost the National system five millions in freight revenue during the year 1919. But no one will say it was not worth while.
The National system carried eleven and a half million passengers during the year, an increase of about one and three quarter millions. Additional services and the return troop movement helped to swell these figures. Total passenger earnings increased from fourteen to a little less than twenty-two million dollars. About a million and a half of this increased revenue is attributable to the 10 per cent increase in passenger rates granted during 1918, and in effect for the first time for the full year. The coupling up of the Canadian Northern and the Canadian Government railways has, I may say, resulted in an increase in better paying long-haul business, and the management has every expectation that this business will be maintained, notwithstanding the completion of troop movements.
Operating Costs.	[DOT]
I shall try not to weary the House with an endless procession of figures, but as

*briefly as possible call attention to their significance, and then append to this verbal .statement detailed statistical information, which, with the permission of hon. members, could appear as appendices to these remarks, and thus receive the leisured scrutiny which their importance warrants. The tables to which I refer differentiate between Canadian National and former Canadian Government lines, and, as well, give the totals for the entire system, with which I have been dealing. They do not, however, include the Grand Trunk Pacific, which, pending the taking over of the Grand Trunk system, has been operated as a separate entity. As receiver for the *Grand Trunk Pacific, I intend in due course to present a detailed report of the operation [DOT]of that line for 1919, though I shall refer briefly to the results of that operation at a later stage of my present remarks.
The operating revenue of the National system as already stated, was more than ninety-three million dollars. The wage bill for the year exceeded seventy-three millions, having, owing largely to the McAdoo series of advances, jumped from fifty-four millions in 1918. In other words, out of every one dollar of revenue earned, seventy-eight cents passed directly, by way of *wages, to the employees.
Labour Conditions.
The cessation of hostilities . appreciably relieved the labour situation and enabled a start to be made on overtaking considerable maintenance of way and equipment work which had been deferred under war conditions. An extra large number of tie renewals were made, which, at the higher price and higher cost of labour, made a large item. Also relaying of rails which could not be gone on with during the war, added to operating expenses. Special locomotive, car, and work equipment repairs were undertaken with a view to keeping in service as much equipment as possible so as to avoid purchase of new units at the extraordinarily high prices to which I shall refer later.
It is to be remembered then, in dealing with the operating expenses for the year under review, that such deferred maintenance work as has been done, amounting to [DOT]over five million dollars, is included in the year's operating expenses, and to that extent has increased the deficit. There is still a large amount of deferred work to do, which will add to the operating costs for the year nineteen-twenty, but it is satisfactory to know that all the work which is being done is increasing the physical value of the property, as well as making for higher efficiency and economic operation.
The position of the 55,000 employees of the National system was materially improved during the year. They worked on the average a shorter day, and capital expenditures for the year included large items for the improvement of their housing and working conditions. In 1914 the average wage per year of the railway employees of Canada was $700; in 1919 on the National system it was $1,447.
The relations between the management and the employees have been very satisfactory. Since Canadian Railway Board of Adjustment No. 1 was established in September, 1918, Canadian railways have been remarkably free from serious labour troubles, and although the National system then comprised 35 per cent of the mileage in Canada, the grievances arising therefrom amounted to only about 16 per cent of the cases before the board. It is hoped that this board, which is comprised of six representatives of the large railway labour brotherhoods and six railway officers, will be maintained so that differences of opinion may continue to be settled by round table conference rather than by more expensive uneconomic and inconvenient methods.
Betterments.
Important progress was made during the year in improving the transportation plant of the Government-owned lines. The aim-of the management is to bring the lilies up to the standard which existing traffic justifies, and to improve these standards as traffic increases, and finally to reach the position where the facilities will provide a slight margin over the immediate traffic requirements, so that when emergency traffic develops there will not be congestion. With respect to many sections of the main lines this margin of capacity now exists, but expenditures are required on various sections, and at terminal and other important points where limiting conditions now restrict the economic handling of traffic. To improve track conditions, 625 miles of new 85 pound rail were laid, and on 130 additional miles of track the existing rail was replaced with heavier section, this-being largely good 80 or 70 pound rail released by the first item. The balance of the released rail was used up on the construction of 64 new passing tracks, and the extension of 35 others; also 44 transfer,

storage and other tracks, and 46 private and industrial tracks. This additional trackage will greatly facilitate the handling of trains and switching in yards.
About $1,200,000 was spent on ballasting. Over 100 trestles were replaced with permanent structures, and many other bridge improvements were made, a large item being $267,000 expended on the St. Charles river bridge. Good progress was made on the important work of providing a second track where in previous years serious congestion has occurred on the Intercolonial railway. The points where double tracking is being undertaken are between Ste. Rosalie and Charlotte, Truro and Belmont, between Springhill Junction and Maccan and also out of Moncton. Over a million dollars was expended on the work during 1919. The double track between Drumheller and Munson Junction, Alberta, has been completed, thus greatly facilitating the handling of coal from the Drumheller mines. In the case of the Drumheller work the grouping of 23 mines in one locality and the attendant mining conditions make the handling of the traffic practically a limiting factor in jiroduction; the movement, too, being crowded into a relatively short season, makes it imperative that good facilities for handling be provided. These expenditures to improve operating conditions produce in many cases a much greater return on the investment than equal expenditures on new lines, as not only are additional earnings secured, but operating expenses are reduced, greater use of equipment is obtained and better service to the fillblic. In line with the mahagement's policy of improving existing facilities, many new structures have been erected, among these being 16 wa'ter tanks, 11 coal handling plants, 2 coaling trestles, 26 stations, 12 station shelters, 13 freight sheds, 4 express buildings, 64 single section houses, 10 double section houses, 36 bunk houses, and 8 workmen's cottages. Such expenditures eliminate train delays, effect labour saving, add needed facilities, provide housing and tend to the welfare of employees.
Additions and improvements to round houses, machine shops and other mechanical facilities accounted for $125,000. General improvements included considerable ditching, widening banks, removing sags preparatory in some cases to ballasting. Some diversions to reduce grades, to give better alignment, or eliminate bridges were completed and others are under way.
[Mr. J. D. Reid.l
The rebuilding of the Canadian Northern line between Cap Rouge and Portneuf, washed out by the tidal wave in 1918, was almost completed.
On Prince Edward Island, where the lines are narrow gauge, a third rail has been laid from Charlottetown to Summer-side, and from Port Borden to Emerald- 60 miles in all, which enables standard gauge rolling stock to be interchanged by car ferry, greatly facilitiating the handling of traffic to and from the Island.
New Construction in 1919.
In submitting the construction programme for 1919, the directors recommended that the work to be undertaken should be as closely as possible confined to completing branch lines which were under construction in Western Canada at the outbreak of the war. Following this policy, work was done on various lines, among the more important being the extension of the Hanna-Medicine Hat line to Red Cliff, and the St. Paul de Metis line in Alberta, and the Humboldt-Melfort connection and Duck Lake branch in Saskatchewan, and in British Columbia the Kamloops-Kelowna line. On Vancouver island, twenty-eight miles of track were laid on grade previously constructed, and forty miles of ballasting completed. The Vancouver passenger station was completed and opened for traffic.
Shortage of labour and disturbed industrial conditions during the summer prevented the expected completion of certain Western branches, but the work on these will be vigourously- pushed this season.
At Toronto, the Leaside terminal yard was further developed. Most of the facilities at this point are now utilized and are proving of great value in handling the business on the lines in Southern Ontario.
Betterments Proposed for 1920.
The following general improvements are recommended by the directors as being among the most pressing requirements oi the system:	.
Canadian Government Railways.
The relaying of about 200 miles of track with heavier steel, and the utilization oi the released steel for additional passing tracks, spurs and sidings.
The completion of the 20 miles of double tracking already referred to and now well under way. Improvements to or replacing of over 200 bridges, trestles and culverts, including filling and other permanent work.
The construction of &5 stations and freight sheds, 7 coaling plants, 7 water

stations, nine buildings for the mechanical department such as engine houses, machine shops, etc., 58 buildings for housing employees such as section houses.
Provision will be made for the general improvement of track conditions, and at St. John an extension of the yard trackage is required, to relieve the congestion at that point.
Canadian Northern Lines.
The construction of branch line mileage in Western Canada provides an opportunity to replace steel now on main lines with heavier section, the steel taken from the main lines being serviceable for branch line traffic. The additional traffic being provided by the branch lines is enabling heavier train movements to be made, and the present demand for all-steel passenger equipment requires the utilization of very heavy power, making it necessary to continually improve the standard of main line roadbed, track and structures.
The programme in respect to rail replacements covers the relaying of 350 miles of new steel on main lines; 331 bridges, trestles aftd culverts are to be replaced, filled or renewed, involving the replacing of many temporary structures by permanent work. The completion of additional mileage in the Prairie Provinces has necessitated the construction of many new buildings, a large item being 68 new stations and freight sheds. There were also built 22 coaling plants. The present price of labour necessitates the adoption of labour-saving devices of this kind. There are also listed 20 new water stations. The mechanical department's facilities will be improved by the construction of new engine houses, machine shops, etc., 19 in all. Some of these are required at the end of new branch lines. Additional lines also account for a number of the 134 section houses required.
A large appropriation is required for general road-bed and track improvements and increasing traffic. warrants improvements and revision of the main line between 'Montreal and Quebec.	.
A greatly needed improvement is the stringing of an additional copper and steel wire between Montreal and Toronto and Winnipeg to provide through wires between these important points, the present wires being required for local business and train despatching. The new wires will also enable new through business to be handled by the G. N. W. through Canada, whereas the company's through business now goes via United States connections.
Construction Programme, 1920.
It is again proposed to confine new construction in Western Canada to the completion of branch lines on which work is well under way. The programme includes work on 16 branch lines in Manitoba, Saskatchewan, Alberta and British Columbia. The principal items of track-laying will be from Eston south-easterly 35 miles; Humboldt-Melfort line, 32 miles; Melfort north-easterly, 32 miles; Oliver northeasterly, 22 miles; Peace River line, 324 miles; Swift Current line, 18J miles, and Jackfish Lake branch, 27 miles. In British Columbia it is proposed to grade 40.4 miles to complete the Okanagan branch. In all, 349.6 miles of track is to be laid and 123.4 miles of line to be graded. The extension of other lines and the construction of additional branches is very strongly urged, and while certain of these projections are fully justified on traffic considerations, their construction has to be postponed on account of the financial situation, labour shortage and high cost of material and supplies.
In Eastern Canada there are several very important connections which can be regarded as essential to economic and unified operation with other lines of the National system,- but which must also be postponed until the financial situation improves. Among these -may be mentioned the Long Lake connection between the National Transcontinental and the Canadian Northern main lines which, when completed, will give the Canadian Northern railway the short route between Winnipeg, Montreal and Toronto.
Rolling Stock Situation.
During the year 1919 the following rolling stock was ordered for Canadian Government railway:
25 Pacific type locomotives,
25 Switching locomotives,
13 Compartment observation cars,
18 Standard sleeping cars,
9 Dining cars,
30 Baggage cars,
130 Colonist cars,
20 Tourist cars,
20 Mail cars,
550 General service or coal cars,
500 Flat cars,
750 Box cars,
250 Ballast cars,
800 Stock cars,
150 Refrigerator cars,
25 Cabooses.
This equipment has been delivered except seven of the standard sleepers, the

dbservation cars, diners,. first-class coaches and mail cars, all of which it is expected will be in service at an early date.
Passenger earnings have shown such a good increase that 30 additional heavy passenger locomotives are required, and 60 additional passenger train cars.
On account of the very high unit prices of rolling stock, the requirements have been kept down to the lowest point consistent with'traffic conditions. This is very necessary in view of the fact that locomotives suitable for our purpose wdiich could be purchased for $24,000 in 1914 cost $62,000 now; first-class coaches have increased from $16,000 to $38,000; dining cars from $28,000 to $46,000. The increase in price of freight cars range from 144 per cent for refrigerators to 170 per cent for steel frame box cars.
The equipment to be ordered is as follow's :	. I
Locomotives.
20 Pacific type-medium weight.
10 Pacific type-heavy w'eight.
25 heavy freight ldcomotives.
20 switching locomotives.
Freight Cars.
3000 40-ton box cars.
500 refrigerator cars. _
650 50-ton coal or general purpose cars.
350 50-ton ballast cars.
100 cabooses.
6 snow ploughs.
150 stock cars.
Passenger Cars.
20 baggage cars.
18 standard sleepers.
12 standard diners/


Mr. CHARLES MARCIL:: Were all these ears purchased in Canada?


John Dowsley Reid: All that could possibly be
obtained in Canada were purchased in this country. I will give the details of the contracts when the House is in committee.


Mr. DEPUTY SPEAKER:: I must remind hon. gentlemen that the House is not now sitting as Committee of Supply and that these questions can be more properly asked when that stage is reached.


John Dowsley Reid: I will be glad to give any information that is desired as soon as we are in Committee of Supply.
The Question of Rates.
The question of rates is one which will bear careful examination. No system can indefinitely stand the relationship at, present existing between earnings and oper-
[Mr. J. D. Reid.l
ating expenses of the National, but before proceeding to a consideration of future rates, it may be wrell to review what has taken place in recent years in that connection. Hon. members will recall the agitation, extending over a period of years, for a reduction of rates in Western Canada, by many urged because it wras felt one railw'ay at least could well afford a reduction. Just a few months before the outbreak of w'ar this western rate case was finally decided. The judgment involved a comprehensive reduction in rates in territory w'est of the Great Lakes, and very seriously affected the new'er lines. Then came the w'ar and w'ith it undreamed of problems of transportation, and the railways began to feel the effects of war conditions. In 1916 what is known as the Eastern rates case provided for a five per cent increase in tariffs of Eastern roads, both Canadian and American, but it did not apply to the West. In 1918 there w'ere tw'o rate increases, the March order, commonly called the 15 per cent- increase, and the August increase of 25 per cent (so-called) which accompanied the first of the McAdoo series of wage increases. There was this difference, how'ever, between the rate increases and the wage increases: the latter were retroactive the rates could not be retroactive; and, in-addition, it wras found that the rate increases, w'hen finally applied, did not produce anything like the increase in revenue hoped for. The first mentioned (15 per cent) netted only seven per cent on the National Railw'ay system's passenger revenue and ten per cent on the system's freight r'evenue, or nine per cent on the gross. The second increase was on freight only, and w'as less in the West than in the East, ow'ing to the equalization of eastern and western rates involved. For instance, in Western Canada the 25 per cent increase wiped out the previous 15 per cent increment. Taken together, these two rate increases are estimated therefore to have approximately only 30 per cent instead of considerably more than 40 as they wrnuld have had they been imposed upon the other.
Now', there are only two ways by which a railway's revenues may be increased. One is by increased rates and the other is by increased business. The Canadian National railways, should-in view of the resumption of trade and immigration, in view' of the strengthening of w'eak spots by the inclusion of Grand Trunk lines, and especially in view of the traffic possibilities of the sixty steamships, the freight of w'hich will come to National railways,-commence to show a steady increase in business, but the

'management has, in the course of public utterances, called attention to the necessity for increased rates if operating expenses are to be met out of earnings. There are and will be various opinions as to this, but it behooves us to give careful consideration to the viewpoint of the management. They point out that Canadian roads are closely bound up with American roads, in proof of which witness the application of the McAdoo awards to Canada. Not only do we pay the same wage schedules and apply the same working conditions, but, generally speaking, freight rates are the same on both sides of the line. In the United States the roads are being handed back to their owners in groups, and the legislation provides that they be allowed to earn 5| per cent on their investments, with an additional half per cent construction betterments. During the war the American roads were guaranteed a certain return which was made up from the Public Treasury. Now that this guarantee no longer applies, either an increase in rates will be necessary or the American Government must continue to implement the earnings of the weaker roads. It is estimated that a rate increase of 26 per cent would be required to put the American roads on a paying basis. An increase to that extent, if applied to the earning of 1919 on the National system, would have produced a revenue of a little more than one hundred and ten millions, which would have left a surplus of net earnings of over two millions. That, of course, does not take the fixed charges into account. The management, therefore, feel that, both because we have the same expenditures to meet and must compete with each other all along the line, whatever freight increase is permitted in the United States ought also to be applied to Canadian roads. As Minister of Railways and having asked the management to operate on a business basis, I am bound to present the management's viewpoint for the consideration of Parliament.
I have, however, a larger responsibility as Minister of Railways, having, as such, to do with all Canadian roads, and answerable, in the final analysis, to the people, who at present find the cost of commodities sufficiently high. The railway situation in Canada has undergone a marked change, the entire mileage being now controlled in two great groups or systems, the Canadian National and the Canadian Pacific. In Canada the mileage of the latter road is 14,824, but there are 4,948 of owned or controlled lines in the United States, so that 55
the system mileage aggregates 19,772. Including the Grand Trunk lines, the Canadian National system will comprise 22,356 miles, of which 2,093 miles are located in the States. These two great systems are, from the mileage standpoint, at any rate, fairly evenly balanced^ and it is unnecessary to point out to honourable members that ahy increase in rates granted ithe Canadian National system would equally apply to Canadian Pacific lines. No doubt, honourable members read in the newspapers recently the annual statement of this immense corporation, which showed that, notwithstanding the disadvantage of increased operating costs and charges common to all roads, the Canadian Pacific railway had been able to pay a dividend of seven per cent on their railway operation and three per cent on their outside operations, or in all their usual 10 per cent dividend on last year's operation.
Now, the argument has been advanced that it would be possible to tax out of the Canadian Pacific Railway any increase in earnings which might be permitted them in common with the Canadian National system. T have my own opinion as to the fairness of such a proposition, but, in any event, I personally feel that such a proposal, even if fair from the standpoint of competition, would not be practicable, for the simple reason that you could not prevent the Canadian Pacific from spending their revenue legitimately on the improvement. of their property, and if, at the end of the year, we found that the increased earnings had gone into betterments, how could we tax it out of them?
My own feeling is that the Canadian Pacific are entitled to a rate sufficient to earn 7 per cent on their Tailway investment, and this they appear to be able to do, notwithstanding present abnormal conditions. The question resolves itself, therefore, into the following proposition:
Shall Canadian freight rates be increased generally for the particular purpose of enabling the Canadian National system to meet its operating expenses and fixed charges, or would it be better to go on with the present rates, giving dealers no additional excuse for increasing the cost of living, and trusting to increase in business, the economies it should be possible to effect by co-ordination, and the return of normal conditions to gradually reduce these deficits until the day (which I personally feel is not far off) when the revenue will prove sufficient to pay for operation and, later, also to take care of fixed charges?



Should this latter suggestion prevail, it would require to be thoroughly understood that the Minister ol Railways, no matter who he may be, must oome down next year with a deficit, and the next year with a deficit, and so on for a few years until we shall have turned the comer.
The earnings of the Canadian Railways last year were 350 millions, made up as follows:
C.P.R	177	millions
Canadian National	 94
G.T.R	
68	"G.T.P	
11	"
A 25 per cent increase on these earnings would approximate $88,000,000, the greater part of which would be earned in Canada. Whether we shall take 88 millions in increased freight fates out of the people of the country next year in order to show a surplus for the National system is a question as to which I myself am not prepared to take the responsibility of deciding either one way or the other at the present time. I leave it to the consideration of the House and of the people of Canada as a whole, and shall be glad to elicit representative public opinion in the matter, so that the Government may be in a position to give this important question the best possible consideration.
Bringing in the Grand Trunk.
The current year will witness the rounding out of the Canadian National Railway system by the acquisition of the Grand Trunk and its subsidiary lines. With these added, it is estimated that over 50 per cent of the domestic freight traffic of the Dominion will be found to originate along Government railways. The connecting up of the Grand Trunk lines will give direct access to eastern industrial centres, especially in Ontario. Western Canadian business originating on Grand Trunk lines will no longer require to be split into three but can go forward in one long haul over all-National lines, and, vice versa, the Grand Trunk will benefit from a large amount of additional business from our Western lines which it could not obtain except as a member of the National system.
Pear has been expressed that Halifax and St. John might suffer as a result of the * Government taking over the Grand Trunk. The people of Eastern Canada need have no fear of this for the reason that these are the terminals of our immense railway systems and have been for many years. They have been greatly improved, and in 
the operation of our National system, more especially in view of the ocean tonnage we now control, these ports will become increasing, rather than diminishing, factors in the Canadian railroad situation.
The connecting up of the Grand Trunk lines will mean that 52 per cent of the entire railway mileage of Canada will have passed under Government control. This will permit of economies in operation where the two systems have been maintaining parallel lines and duplicate staffs, and, as already pointed out, there should be compensating advantages to the Canadian Northern, the Intercolonial and the Grand Trunk as well. I wish to point out, however, that, in speaking of advantages, I am referring to the Grand Trunk lines only, not the Grand Trunk Pacific or the Transcontinental Railway systems. These last named colonization roads, built as part and parcel of the Grand Trunk, are bound to be unprofitable for many years to come. The loss on operation of the Transcontinental last year was $2,735,000. This was included in the Canadian National figures already referred to. But there is also the Grand Trunk Pacific, which the Government found on its doorstep in 'March oi last year, and as to the operation of which I shall have to make a separate report, as the figures form no part of the National system figures with which we have been dealing. But to make my present statement complete, I desire to point out that the Grand Trunk Pacific for the year ending December 31 last showed an operating loss of five and a half millions. To this must be added fixed charges of eight and a half millions, making a total deficit of fourteen millions, an increase of three and a half millions over 1918. The reasons for this increase was set out in a communication from the General Manager to myself as Receiver, and these will be dealt with at the proper time.
Personally, I do not think it will be possible for many years to make the expenses of operating these colonization roads, nor do I think it fair that they should be expected to make the showing we look for from the Canadian Northern, the Intercolonial or the Grand Trunk proper. Therefore, I think the annual loss on these railways should not be added to the net deficit of the Canadian National railways for purposes of comparison, and I have instructed the management that the operation of these systems must be shown separately at the close of each year, so that when comparisons are made between other systems and

our Government system, the comparison may be a reasonably fair one.
Hudson Bay Railway.
There is one more railway which was commenced and which has not been completed, which is known as the Hudson Bay railway. For the information of the hon. members, I may say that the Government has decided that no more work shall be done on that during the coming year. It is the intention to use every effort to extend branch lines into districts where settlers are much more in evidence and in much gieater need of railway communication. The Hudson Bay Railway will therefore stand until financial conditions will permit of its resumption.
In conclusion let me say there was a time, not long ago, when the Government system was largely a local carrier getting the short end of business that goes with the short haul. The longest haul it could Hope for was from Halifax or Sydney to Montreal, and vice versa. And in competing with the Grand Trunk for Montreal business offering to the seaboard, we could charge only the Portland rate, though the Intercolonial mileage to Halifax was 841 as against the Grand Trunk's 297 to Portland. Similarly, the Canadian Pacific railway had the advantage of its comparatively short haul of 481 miles to St. John, and for business originating at the Intercolonial chief terminal, Halifax, it had to compete with this same highly organized and stronger competitor, whose agents were always active abroad and whose ships were ever on the seas. But a change has come over the scene. Now the Government system itself bestrides the continent, with branches reaching for the first time into productive centres and with terminals upon both Eastern and Western oceans. The story of the Canadian Government Merchant Marine has been told by the proper minister, and at last we also have our ships upon the seas, and our agents abroad will actively compete for international trade. Keen competition, " adroit, persistent, aggressive and fair," is promised by the President of the Canadian Pacific, who expresses the hope that both their own systems and the National may in future work in common for the advancement of the country. He says there need no longer be controversy, but that there will always be keen competition. That is what the management of the National system expects and welcomes. I am told that the nationalization of the Canadian Northern has made no difference in the morale of the employees of that road, that they are as keenly alert as ever and " on their toes to make government ownership and operation a success. We expect the employees of the Grand Trunk systems will co-operate with equal loyalty, and the (Government in turn will spare no effort to build up a great National railway system able to compete with and maintain the high standard of transportation efficiency reached by the Canadian Pacific. That road may well be the standard against which we may measure the success of government ownership and operation. I say " success " because I am not prepared for one moment to contemplate any other possibility. The National lines, with the Grand Trunk included, will comprise a system which will (Serve every province in Canada, which is identified with every progressive community, and- must continue to perform the major part of the transportation service of the entire Dominion. We have taken steps to remove the Government's lines from political interference. Experienced railway men are in charge; they are being .given money to improve the roadbed, to ,buy the best equipment to enable the greatest tonnage' to be hauled in a single train. It is the greatest encouragement towards expansion to have this great National system ready and equipped to handle additional traffic as it develops-and it surely will develop. If we imagine Canada to have reached the maximum of development then we shall have planned foolishly, but I, for one, have the faith to feel and the vision to prophesy that this great transportation system is not being prepared to perform this splendid transportation service in vain.
I would like, Mr. Speaker, to hand in these schedules to be inserted in Hansard so that hon. members may have before them all the details I have mentioned.
Canadian National Railways.
Comparative summary of operating results-12 months ending December 31, 1918-19.
Operating Revenue.
1919.
1918.
Increase. % Increase.
Canadian Northern .. Canadian Government Canadian National ..


Georges Henri Boivin: Does the House unanimously consent that the schedules mentioned be inserted in Hansard.
Consent unanimously given.
(The figures in the subjoined comparative statements are not final and are subject to slight modifications as complete returns become available):



CANADIAN NATIONAL RAILWAYS.

[Stage Direction]
Revised Estimate of Wages for 12 Months at Present Rates.
Showing increase under McAdoo Award, Supplements and Collateral Increases down to and inclusive of 4c. increase to Shopmen. ' Based on number of hours on duty for all employees for year ended June 30, 1918.
Class of Employees.	Compen- sation prior to G.O. 27.	Increase under G.O. 27	No.	Increase under Supplements.	Estimated Wages 12 months under existing rates.	Total increase over 1917.	Amount.	%	Amount.	%	Amount.	%[DOT] $ cts.	$ cts.	$ cts.	$ cts.	$ cts.	Maintenance of way.... Maintenance of equip-	10,686,978 83	2,837,304 88	26-55	8	4,701,487 53	43-99	18,225,771 24	7,538,792 41	70-54ment	9,595,877 56	2,921,562 96	30-44	4	3,163,022 42	32-96	15,680,462 94	6,084,585 38	63-41Enginemen	5,334,427 54	611,870 90	11-47	15	636,986 23	11-94	6,583,284 67	1,248,857 13	23-41Trainmen	6,323,329 91	673,679 16	10-65	16	392,532 24	6-21	7,389,541 31	1,066,211 40	16-86Agents and telegraphers Clerical and other sta-	2,468,844 39	177,110 04	7-17	13	956,310 93	38-74	3,602,265 36	1,133,420 97	45-9tion forces	
Various (not distribut-	6,199,273 57	1,195,561 46	19-28	7	1,970,280 30	31-79	9,365,115 53	3,165,841 76	51 07ed)	
Officers	1,381,846 26 1,275,303 73	261,059 04	18-89	Var. Coll.	830,981 46 361,353 81	60-14 26-33	2,473,886 76 1,636,657 54	1,092,040 50 361,353 81	79-03 28-33Grant total	43,265,881 79	8,678,148 44	20-06	13,013,954 92	30-07	64,956,985 15	21,691,103 36	50-13
Toronto, February 24th, 1920.
(Sgd.) E. P. MALLORY,
Statistician.
Mr. FRANK CAHILL (Pontiac):: Mr. Speaker, the hon. minister's address will, I think, confirm the opinion generally held throughout the country that the Government have absolutely no railway policy. He has just stated to us, if I caught his figures correctly, that we made a loss on operation of $14,000,000 and a loss on interest charges of $19,000,000, or a total loss of $33,000,000, and that no provision whatever for maintenance is included in these figures. So that he comes down to us to-day with a statement showing that if we had maintained the road properly we would have sustained a loss this year of not less than $60,000,000; and he tells us also that this loss is to be continued for one year, perhaps for two or more years, perhaps for many years to come. He states in his usual way that he has no policy as to what is to be done about this deficit: Whether he is going to ask the people to continue to pay these heavy losses [DOT] out of the treasury of the country or whether he is going to adjust his management so that the road will earn the revenues that it should earn. The minister did not say a word, so far as I heard, about the management. Apparently he is. quite satisfied to let the Mackenzie and Mann crowd go on tapping the treasury of Canada indefinitely. He is not prepared to tax the people who are using the service; he is quite willing that the Mackenzie and Mann crowd should go on spending this $50,000,000 or $60,000,000 a year without giving any information whatever to this House or to the country. The amount that the minister mentions is only the deficit; no account is taken of expenditures necessary for maintenance or for betterments. During the past two or three years we have spent huge sums on this system, and all that we can get from the minister to-day is that we may expect to go on spending forty, fifty, sixty or more millions per annum until these railroad barons, these Canadian robbers, shall have exhausted the treasury of this country.
The minister stated that colonization roads were not paying. I am glad to see the leader of the Government (Sir George Foster) in his seat, because I wish to direct his attention to a matter with regard to *colonization roads that is of prime importance to every Canadian. We have developed in the northern part of Quebec a railway system and we have settled in that country upwards of 15,000 of the best colonizers that can be found anywhere in the world; they are the only people who will ever colonize the northern part of our Canadian domain. They are not like the people who were being
(Mr. Deputy Speaker.]
taken out of Kapuskasing during the last few months; they are doing successful work in the district in which they have settled. The only drawback is the lack of railway facilities. I wish to read an affidavit which I received from there a few days ago. It is signed by Frank Blais, and reads as follows :
I,	the undersigned, Erank Blais, lumber merchant. of the village of Amos, make oath and say:
1.	There is actually at the different sidings between La Heine and Nottaway-
That is a very short distance in that country.	.
-on the Transcontinental railway, more than 60,000 cords of pulp wood piled up ready to be shipped.
2.	There is also in this same district 20,000,000 feet of sawn lumber ready to be forwarded which was left in the yards from 1919 on account of the shortage of cars, and there will be about 60,000,000 more manufactured during next season.
3.	It would need about 6,500 cars to ship the lumber and pulp wood already piled up ready to be forwarded.
4.	The authorities of the Transcontinental have only placed at the disposition of the owners of the pulp wood and lumber about 50 cars during the whole month of February, and about the same proportion during this month of March.
5.	When the cars are loaded and moved from our sidings, they only reach their destination point after a delay of six or eight weeks, and often more.
6.	The employees of the railroad will not take the trouble of placing the cars on the sidings in the proper way to be used conveniently by the shippers, and the engines used do not seem to be in the proper state to give satisfaction in moving the cars.
7.	The whole Abitibl region is suffering heavy losses from the facts above mentioned.
And I have signed:
Frank Blais.
Sworn before me at Amos this 22nd day of March, 1920.
C. A. Lafrance, N.P.,
Com. Supreme Court. District of Quebec.
Now, there is the condition of the road that the minister states lost traffic last year on account of the war being over. He says that the earnings were decreased because the railways did not have the traffic; yet here is traffic lying right at hand that has not been moved. I want to read the letter accompanying the affidavit, because it throws light on this subject, and there is a good deal of truth in it. It reads:
Again we have to apply for your protection and to ask you to take our interests in hand. I am writing in my own name, but I will send you declarations by other lumber merchants and pulp wood dealers, which shall prove to you that the same unfortunate situation exists all over the Abitibi region. We believe this

state of affairs could be improved with your help, by putting the case before the authorities of the Federal Government, which has full control over this situation.
You are perfectly aware of the fact that the pulpwood and lumber trades are the only sources of revenue for this part of the county. To take advantage of this industry we necessarily need cars for the transportation of the lumber and pulpwood, and we actually have no cars of no kind for that purpose. We are asking such cars through all the officers of the railway, with no result.
I have myself over 15,000 cords of pulpwood, at a cost of more than $120,000, and I can get no cars to forward the same. I have made a demand for 30 cars a day, and I received an average of one car per day. In two months from now all that wood we own will be exposed to burn in the bush fires, and we could not sustain such a loss. The money has been advanced by the banks, who are helping us to buy that pulpwood from the settlers, who have no other means to support their families. It would also be a total loss for the paper mills, that are already blamed on account of the high price charged for their paper. We have been compelled to stop buying any pulpwood, not being able to ship what we have on hand, and there is still a great quantity for sale by settlers, who are waiting on such sale to support their families.
There is in the Abitibi region about 55,000 cords of pulp wood to be shipped before the bush fires become a danger and it would need about 4,000 cars.
There was about 20,000,000 feet of lumber left from 1919 on account of the shortage of cars and there will be about 60,000,000 feet more during next season, which will need about 5,500 cars for expedition and we are wishing that you would ask the Federal authorities to prepare for such expedition of lumber and to provide for the actual need of cars for pulp wood.
. You will probably have as an answer that there is no cars to be had, but I can assure you the contrary and as an example let me tell you that in February last, at Hearst, west of Cochrane, there were enough cars loaded there to force an embargo on the shipments of pulpwood from that place and there were more cars loaded than could be received; while in that same month of February my requisition was for 30 cars a day and all I had during the whole month was 6 cars.
I believe the officers of the railway in our region are doing their best to help us, but their instructions come from a higher source that does not seem to sympathize with our requirements.
Every year there are thousands of cords of pulpwood burned by the settlers who cannot sell such wood on account of the shortage of cars. This is a serious loss and we believe that the situation could be very much improved if the Federal authorities are willing to do so.
Mr. Speaker, the intimation in this letter is that the Federal Government are deliberately trying to kill settlement in the Abitibi district. It is well known that the members of the present Government who were in Opposition when the road was built opposed its construction, and it is well known that they have since taken every
means of opposing the development of that country. I want to ask the leader of the Government-I am tired asking the Minister of Railways and the Department of Railways for help in that district-if it is the studied policy of the Government to choke that district off; if it is their determination to see that the settlers have no means of subsistence? Or will the Government see that these people get relief? The railways of the country cannot possibly succeed if this kind of management prevails throughout Canada. We are told by the minister that they do not succeed. Well, scarcely any person expected anything else. Having regard to the present system of no management for the railway and no railway policy on the part of the Government, how can we hope that the Canadian National railways will succeed?
I shall not take up any further time until I have had an opportunity of studying the minister's statement. But I do hope that before this discussion proceeds the minister will lay down some definite policy for the management of these railways.


Mr. H. A. MACKIE (Edmonton East):: If the minister will answer definitely a question which I have put to him by correspondence and on the floor of this House, I will refrain from laying my grievances before the House on this occasion; otherwise I propose to make my speech. When will the Oliver-St, Paul de Metis railway be completed so that a service may be afforded to people who have been suffering from lack of railway facilities since 1909?


John Dowsley Reid: I will have the particulars when we get into committee and will be able to give the information then.


Mr. W. H. WHITE (Victoria):: I also would like to ask the minister a definite question.


Georges Henri Boivin: The hon. member would not be in order in putting a question to the minister. The hon. minister has exhausted his right to speak and is, therefore, precluded from giving a reply.


William Henry White: I do not wish to extend my remarks very much if the minister can give me the information I desire. I am interested particularly in one branch of railroad. As to other matters-


Georges Henri Boivin: That information can be given to the hon. member in Committee of Supply, but it would be absolutely out of order for the minister to give it now.


Sir GEORGE  POSTER@: If my hon. friend will allow me, he will receive an answer to his question almost immediately if he allows the House to go into Committee of Supply. These questions cannot be put and answered on the motion for Committee of Supply. We always like to get into Supply as soon as possible so as to give hon. members an opportunity of putting questions and having them answered.


William Henry White: I thought perhaps if I mentioned what I was going to take up the minister would be able to say whether he was going to deal with that question or not; and if not, I was going to make a complaint on account of a promise made by the minister last year. I do not know whether I am in order or not. I wanted to make a statement as to what I wished to complain about. If the minister is going to deal with that question, I am quite willing to wait until the House goes into Commttee of Supply.


Georges Henri Boivin: The hon. member is quite in order in making any statement upon the motion to go into Committee of Supply. It may relate to this or any other matter which has not been previously debated during the present session or which is not already inscribed upon the Order Paper.


William Henry White: Last year before the Railway Committee the minister promised, at a time when the Canadian Pacific were applying for a charter for a line parallelling the line of the Canadian National railway, that if they would withdraw, and the committee, instead of supporting the charter of the Canadian Pacific for a Jine to parallel the line of the Canadian National railway, would give the department an opportunity, they would guarantee to build a road from Whitford to Bruderheim. The Canadian Pacific had arranged to extend their line from Cutknife to Whitford and wished to extend it to South Edmonton. I may say, in passing, that Whitford is an old thickly populated settlement, a settlement that has been in existence for some thirty-five years. Every odd or even section is under cultivation in the whole district, and a delegation came here, sent by the people from that * district, they naturally being very anxious to have railway facilities. There were present that day in the railway committee Mr. D. C. Coleman, Vice-President of the Canadian Pacific, and Mr. McLeod of the Canadian Northern, and it was . arranged amongst them that day that the Canadian
[Mr. Deputy Speaker.!
Pacific would be allowed to extend their line through Lloydminster to Whitford and the Canadian Northern would extend on their old charter from Whitford to Bruderheim, thereby relieving the people in that section of the country. The minister at that time promised that the railroad would be built last year. I might say that at that time Mr. MoLeod stated that the line of the railroad had been graded some four miles. II took the opportunity then to point out that the grading had been started, but that very part of the road that he claimed was under construction was now being farmed and under crop. The minister, however, promised that that extension would be constructed to relieve those people, but not a sod has been turned and nothing has been done along that line. That is why I rose to ask if any provision was made in the minister's programme that the construction of that road should go on this summer. That is what I wanted to bring before the House and the minister.


Mr. D. D. McKENZIE (Cape Breton North and Victoria):: Mr. Speaker, I quite understand that we have some latitude when we come into committee and deal with specific items. Nevertheless, the minister himself found it necessary to make his statement while you, Sir, occupied the Chair, and when we have a wider range of discussion, as he might possibly find any particular item too narrow for the statement which he found it necessary to make. In like manner, I presume that private members of the House will find it necessary, in order' to deal in a general way, with the statement made by the minister and the matters of policy which that statement contains, to deal with this question perhaps a little more at length while the Speaker is in the Chair and the matter is before the House as such.
For the last number of years we have heard a great deal about railway policies, railway ownership, private ownership and public ownership. I have been following the different changes that have been taking place in this House and in the country with regard to railways for some twenty years past; and the Government of the day and the party behind it take much glory to themselves because they say that they are big Canadians in connection with railway policies, and that they have a big policy in connection with railway matters. Speaking for myself, I have always contended and I still contend that the proper way to do railway business or any other business that can be

left to a private concern, is to have it done in that way. I have always contended that, whatever the reason may be, it is impossible to get oiut of men and measures and policies in the hands of Governments the same satisfactory results as we get from private ownership and enterprise. This country of ours is the same from coast to coast, it is the same from the American boundary to the north for everbody that is in it; at least, we hope that that is the case; that there is no discrimination; that there is no favouritism. We hope that there are no shackles thrown around the neck or limbs of any person who is in business. We find in this same Canada a corporation, to which reference has been made to-day, doing splendid business, extending their lines, keeping their lines in first-class shape with everything going along well, and in the adverse conditions with which they have had to deal within the last year, they come down with a dividend of 10 per cent upon the operations of the year. That is private business, that is the management of some 22,000 miles of railway in the hands of private men, men who have grown up in the business, men who are trained, men who have nothing else in view but the business of the company, and the company is making money. That is one side of the matter; that is the side which I have always advocated, the side that I stand by. It was flung at us last year by hon. gentlemen opposite that we were the enemies of the country because we did not jump at this idea of Government-owned railways and Government management of railways in this country. If any evidence were required to show that Government management of and Government enterprise in railways in this country are a huge failure, we had that evidence in the most conclusive manner from the statement in its very best form that was given to the House to-day. The statement made by the Minister of Railways (Mr. J. D. Reid) to-day bears at every line, at every turn and at every page, the earmarks of the special pleader, the preparation, not of the minister, but of those who are under him, those who are trying to make the most of a bad bargain, and to make appear in the very best light the jumble of figures, the jumble of lines, the jumble of management which is foisted upon this country and which burden we have to shoulder. If I wanted to present the worst example of Government management of a railway or any other enterprise, I have it here. We are told that there is a deficit of something like $95,000,000 or $100,000,000, but
that figure merely touches the fringe of the truth, as we should find if we had it. There is nothing said about what must be expended on these lines to put them in such shape that we can compete with our great competitor in this country. What can one say? What can one suggest? I would say to the Canadian people, if it were possible; get from under this burden as quickly as you can. Get it in business-like shape as soon as you can. Get it under proper management and try and make it work its way along; let one hand wash the other, so to speak. That is what any sane person with any sense of responsibility would say, if there were any means of bringing it about. I presume, however, that having been exploited for the last twenty or twenty-five years by private owners, who have kept running to their friends in this House and in this Government and have been getting all the money they required to make millions for themselves, the roads are in such a condition to-day that no private enterprise would take this monstrosity off our hands on anything like fair terms. We, therefore, have to make the most of the -situation, and try and get the enterprise into business-like shape, putting all our energy behind it. It is now some, two years since we were rushed here to pass an Act of Parliament for the purpose of creating some, corporation that was to take hold of these roads. Politics were to be thrown to the winds, we were told. There was such a rush to get that legislation through Parliament that before the Bill was printed closure was applied in this House. You will hardly believe it, Mr. Speaker, but five pages of printed matter were added to the Bill after the closure had been on for twenty or thirty-six hours. The enterprise was so big, and the responsibility so great and pressing, that the Government could not wait one minute to put these roads into the hands of this corporation that was to be created. Well, the legislation passed. Summer came, then winter, then another summer and winter, and now I think we are getting near the close of the third year since that Bill was passed, and yet no action has been taken by the Government under that legislation. Nobody has been appointed, and things are pulling along just as they please. We are supposed to have a business 'Government, a business Minister of Railways, a business-like management all around. We are told we have these things, but what do we find when we look in the next? It is very nice, if a man is running a hennery, to have fine hens, but

you want to look in the nest to find if there are any eggs, to see what results these birds of beautiful plumage which you are feeding, and feeding highly are giving. When we look at the nest in connection with this railway we find it is like Mother Hubbard's Cupboard-always empty. We are feeding it highly, but the balance is always on the wrong side. We get no results. How long is this to continue? I appeal to my hon. friend the Minister of Railways whether he is satisfied with this condition of things. I do not think he is. I think he says to this management from year to year, before presenting his statement to Parliament: Prepare this monstrous nightmare yourself. It is bad enough for me to be obliged to read it, but I will go into the House, supported perhaps by a glass of whiskey or something, and I will read it.


Some hon. MEMBERS:: Take it back.


Mr. J. A. CURRIE (North Simcoe):: This is a dry country.


Daniel Duncan McKenzie: Perhaps it is. It was certainly a dry statement. There is nothing personal, however, to be said in connection with this undertaking. It is too crushing a load to be put on the back of any one person. I appeal to the people of this country and to the management of this system, if there is anybody responsible among them, to see if something cannot be done to take the enterprise along lines where there will be a show of daylight at some stage. The Minister of Railways tells us we are going to get around the corner. That is a wonderful soit of corner. It reminds me of the fool jackass that had a tuft of hay put on the end of a pole tied around its neck with a rope, so that the tuft of hay was always ten feet ahead of him. We seem to be getting further away from this corner all the time instead of approaching it, and we are spending millions upon millions of the people's money in the process, without any hope of ever getting it back. That is the position to-day. Without going into details just now, let me hope that there may be a prospect of reaching this corner, which seems to be so extremely difficult to get at. It took Moses forty years to get to the Promised Land, and it looks as if it was going to take us an equal number of years to put our hands on this corner which the minister is holding out to us, where better things will be in prospect for the people of this country.
We were told that the railways were to be taken clean out of politics, that politics was

to have nothing whatever to do with them; but what was the statement made to-day? The minister says that the management have no policy, they cannot determine what should be done. We must do one of two things, he says. We must continue to plunge into the pockets of the Canadian people, or we must dig into their pockets in another way by increasing the freight rates. The management, he says, have not got a policy; they have not the punch or the backbone to decide for themsleves, and so they ask me to decide. But I will not decide. I do not know what is to be done, so I will bring the matter back to this old political court, and you can do as you please about it. Is that getting away from politics? Are we not getting the railways back into politics worse than ever before? We were told that it cost this country some millions of dollars every year while we were trying to get the roads away from politics, and that in future politics would have nothing whatever to do with the roads. I say, Mr. Speaker, as my hon. friend from Shelburne and Queen's (Mr. Fielding) told this House last year and the year before, it is impossible for any road or any property that is owned and managed by the people of this country to get away from political influences. Even if it were possible, I would not be a party to it. So long as the people of this country are putting their money into any enterprise or are being taxed for the maintenance of any undertaking in this country, they should have an opportunity through their representatives in this Parliament of having something to say about it. To suggest that we can spend hundreds of millions of dollars of the people's money every year without the people having anything to say about it, is a most absurd and unworkable proposition, and the sooner we get back to rock bottom, and understand that the people of this country have a right to know what is being done with their money, the better. If we appoint a management to look after a railway or any other enterprise, that management must be answerable to the people of this country. This Parliament should have something to say about their appointment, and the Government should be perfectly frank and open with us, so that we may at the earliest possible moment know precisely what may be expected to be done. We cannot go on in this way, Mr. Speaker. I am sure that on either side of the House the minister could find wisdom, experience and the faculty^ of direction that would materially help him if he would only seek for these qualities.

, Now, Mr. Speaker, I think that at this stage it is perhaps in order for me to point out to the minister that the people in the part of the country from which I come think themselves entitled to at least fair consideration in matters of transportation. The section of the country which I have the honour to represent in this House is the oldest part of this great Canada of ours. In my county is the spot wheTe Cabot is supposed to have landed some two hundred years ago, and it is a matter for surprise, and some indignation, on calm reflection, that the splendid people in that part of Canada are 110 miles from the nearest railroad. The people are adept fishermen and successful farmers, but they lack transportation facilities. In 1911 the sum of $100,000 or thereabouts was placed in the Estimates in order to provide a start in railroad building down there, but when this Government came into power they wiped that Estimate out. They declined to do anything in the matter, promising instead to consider the situation at a later date. In 1914, the minister being in the House, I introduced a resolution to the effect that the time had arrived when something should be done to furnish with proper facilities the good people in the Island of Cape Breton, in the county of Victoria. My good friend accepted the resolution in 1914; but, the war intervening, I deemed it proper, in the national interest and in view of the exigencies of the crisis which had suddenly burst upon us, not to press my resolution at that time or during the war. Last year, however, I moved another resolution in the House expressing the view that, in the opinion of the House, the time had come when my former resolution of 1914 should be implemented, and urging upon the Government the imperative necessity for action. That resolution was accepted by the minister and the Government, but I regret to say that nothing has been done, not even a survey having been undertaken. I find that my hon. friend is extending lines west, buying new lines, and doing sundry works in various parts of the country for the purpose of improving the railway facilities of Canada. I have no fault to find with this programme, but I do say that it is now away past the time when the Government should implement its promises and carry forward a policy that was intended by previous Governments to be fully prosecuted. It is not to the credit of this Government that part of the railway policy of the Laurier Government in 1911 was ignored to suit their purposes. Every Tory road that was in contemplation at that time was built; but because this little road of mine in the good old county of Victoria happened to be in the constituency of an Opposition man, nothing has been done there. I submit that the good peole of my county should not be - punished and deprived of railway facilities simply because, of their free will and in the exercise of the franchise, they sent to the House of Commons a representative who does not happen to be sitting on the same side of the House as the Government. That should not be the policy of any Government; least of all should it be the policy of the Union Government. The policy of the Government should take cognizance of the best interests of every part of the country regardless of the political procliviities of any community. At a later stage, Mr. Speaker, I may have something further to say on this point.
I had the pleasure of meeting the minister in my own town of North Sydney some two years ago, when the hon. gentleman had an opportunity to see the congested condition of the chief terminus of the Intercolonial railway in Eastern Nova Scotia. He saw that the wharves were not large enough and that there was not enough space. There were more steamships in than there was space to accommodate them; and ten cars were ready to be pushed on the wharf where there was room for only one. Through that point goes out the immense traffic that Canada has built up with Newfoundland, and the minister was impressed with the great necessity that existed at that time, and that still exists, for attention to that terminus. Nothing has been done, however. As I heard the minister reciting the various improvements and extensions of facilities which are contemplated, I was astonished to hear nothing about this terminus at North Sydney. Probably it is not a matter of very great concern to us as to what are the requirements of the Dominion of Newfoundland, although we should have at heart the interests of every part of the 'Empire to which we belong. But at the same time the trade that has been built up between all parts of Canada -Winnipeg, Montreal, Toronto, Halifax, etc.-with Newfoundland is immense, and if we desire to maintain that trade and traffic we must have proper facilities at the terminus at North Sydney, so that people will not have to wait two or three months before getting freight through because of a lack of accommodation. It is not a matter of personal interest to me whether or not the trade goes through that

point, but it is in the interest of the whole of Canada that we should hold on to the enormous traffic which has already been built up. It is not always gratifying, although it sometimes affords a bit of satisfaction, to find one's prophecies and predictions fulfilled as time goes on. But I have always, in the face of opposition and of threats from hon. gentlemen opposite, maintained, as is apparent now, that the best way in which to deal with questions of a large character, such as the management of railways in this country, was by private enterprise if private enterprise were willing to take hold of the!', business. In conclusion, Mr. Speaker, let me read a statement that was made by Lord Macaulay as far back as 1830, and which applies to this question of State ownership as compared with private enterprise. [DOT] Lord Macaulay said:
Our rulers will best promote the improvement of the nation by strictly confining themselves to their own legitimate duties, by leaving capital to find its most lucrative course, commodities their fair prices, industry and intelligence their natural reward, idleness and folly their natural punishment, by maintaining peace, by defending property, by diminishing the price of law, and by observing strict economy in every department of the State. Let the Government do this; the people will assuredly do the rest.
Although there were at that time few Government-owned railways, or indeed railways of any kind, there must have been other enterprises whose conduct led Lord Macaulay to make this wise statement, which is more or -less prophetic in its application to present day conditions. I submit to the best judgment of the Government this advice which the great British statesman gave so far back as the year 1830, and hope that the Government will do one of two things: Either organize some concern that will take this business out of their hands; or, if they will not do this, see to it themselves that proper management is put in charge of affairs so that we may have an institution that will at least pay its way, although it could not pay any interest on the huge sums of money which the people of Canada have invested in the enterprise with which we are now dealing.
Mr. ROBERT H. BUTTS (South Cape Breton and Richmond): I wish merely to contribute one or two observations to this debate. Listening to the speech of the hon. gentleman who has just taken his seat I was struck with the remarks he made with respect to railroad matters chiefly, and particularly in regard to Mackenzie and Mann. I would like to remind my hon. friend that
[Mr. McKenzie.!
the eggs that hatched out Mackenzie and Mann were hatched out in a Liberal nest; that the eggs which hatched out the Transcontinental railway were hatched out in a Liberal nest; and that the two knighthoods that were bestowed on Mackenzie and Mann likewise emanated from a Liberal nest. My hon. friend's remarks might come with very good grace from almost any member on this side of the House, but it ill behooves any hon. gentleman opposite to make such comments and remarks as my hon. friend has indulged in. Let me say in this connection, there is an old proverb that it is a dirty bird that soils its own nest.
With respect to the question of the terminals at Sydney and the facilities for handling the Newfoundland trade my hon. friend is perhaps as well, if not better, acquainted with conditions there than any one in this House. He says that hardly a day goes by that he does not pass those terminals, hardly a day that he does not find there, to a greater or less extent, a congestion of trade. That is true, but that congestion of trade is owing to the fact that the Reids' have never performed their end of the undertaking. They have got a nar-row-guage railway from Port aux Basques to St. John's and it takes their express train, if she runs on time, 28 hours to cover that distance. Now, you can imagine, gentlemen, if you were operating a line of boats that were able to carry away all the freight that goes to North Sydney how you would feel upon reaching Port aux Basques to discover there is not at that place room for its accommodation. I have been to Port aux Basques and seen the existing wharves and sufficient ships cannot be docked there to carry away the freight that is brought in the fall of the year, when the maximum amount of congestion occurs. Consequently the Reid people are obliged to put on extra boats. Those extra boats come directly from North Sydney where all the freight for Newfoundland is handled, but they do not go to Port aux Basques; they go to Placentia and St. John's directly, because the Reid railroad is not capable of handling all the freight that offers. Therefore before any complaint can be made against the railway and terminal facilities on Cabot Strait we should require the Reid-Newfoundland company to provide facilities for handling it on the other side. What is the use of taking freight down to Port aux Basques, when in the first place you can only dock your ship if the pier is vacated by the Reid-Newfoundland boats, and then only one at a time. And even if

you could dock your ships fast enough there is not sufficient storage room nor wharfage to take all the freight- offering. Even if there was sufficient dock accommodation there is not a railway capable of carrying the freight from there to Placentia or St. John's. Such are the actual conditions at the present time, I have hinted at the desirability of improvements at different times to the Minister of Railways, and I hopd he will take those hints into consideration, and that the day is near when instead of relying upon the Reids', the Canadian Government will take over the control of the facilities themselves, handle their own freight, and as far as possible their own passenger boats, running directly from Sydney harbour to Placentia or St. John's, and act independently of the Reid-New-foundland company. Then gentlemen, we will have a solution of the problem which awaits settlement down there. Until some action of that kind is taken no remedy will be afforded. Imagine a railway running from St. John's, Newfoundland, to Port aux Basques, through a territory of 520 odd miles and taking 28 hours to cover that distance, having to traverse a narrow-guage road so exposed at certain points that freight cars were blown off the track in the month of November.


Some hon. MEMBERS:: Oh, oh.


Mr. BUTTS:: It is not a thing to be
laughed at, gentlemen, the incident which I have mentioned actually occurred. These are the conditions that the Government have to face, and if the terminals at Sydney harbour are not large enough the best thing to do would be to cease relying upon the Reid-Newfoundland company and let this Government handle the traffic running directly from Sydney harbour to Placentia or St. John's, Newfoundland.


Mr. P. F. CASGRAIN (Charlevoix-Mont-moreney):: I am very pleased to have had the privilege of listening to the address of the Minister of Railways. It is always a pleasure for me to hear him, because he reminds me that whenever an advocate has a bad case if he speaks sufficiently loud and sufficiently long he can make that case appear somewhat presentable. The hon. member for Pontiac (Mr. Cahill) has described that policy as a little nebulous and I am inclined to think that was an appropriate characterization. Under the terms of the previous legislation the Government has acquired most of the Canadian railways with the exception of the Canadian Pacific railway. In the statement which he has
presented to-day the minister told us that he puts the Grand Trunk Pacific and Grand Trunk to one side because they do not show any profit on their operations. He says that this year and next year, and perhaps for two or three years, he will have to come to Parliament and ask for a vote of some millions from Parliament to cover probable deficits resulting from the operation of these railways and provide for the improvements which they may need. The minister, however, does not give us any indication as to these amounts which it will be necessary to provide from the Dominion Treasury. There is another point which impressed me very forcibly this afternoon, and that was when I heard the Minister of Marine reply to the hon. member for Quebec West, with respect to the loading of certain ships at the port of Quebec, The minister said: "We have nothing to do with this matter, it is in the hands of the Canadian Government Mercantile Marine Company.'' Practically the same reply was made' by the Minister of Railways on the same subject. In view of this attitude on the part of members of the Government we have this situation:	That although we are the shareholders, and are supposed to be the owners and stockholders of the Canadian National Railway System, members of the Government come here and declare that they know practically nothing about the operation of ships belonging to the Canadian people be-. cause the management of these vessels has been turned oyer to a limited corporation which alone is going to deal with the matter. '
There is another point to which I desire to draw the attention of the House and it is this:	Some days ago we heard that the
president of the Canadian National Railways, Mr. D. B. Hanna, for whom I have a great respect, had stated in the course of an address at a certain meeting-I think it was reported in the press-that the Government should -keep their hands off the Canadian National Railway and its administration. The Minister of Railways (Mr. Reid) has said the same thing, and hon. members on the other side of the House said the same thing when the Canadian National Railway Company was being incorporated. Whenever any of us have occasion to discuss any matter with the directorate we are told that the administration of the railway is in their hands, and that inasmuch as the people have placed them in control they-the directorate-are clothed with all the necessary powers in regard to operation and improvements. I object to this principle, Mr. COMMONS
Speaker, as I objected last year when the Canadian Northern Kailway Bill was before the House. We then protested against that policy, because it was equivalent to taking away from the people the right of being consulted as to the manner in which public money should be expended.
Although I may be called somewhat too parochial, Mr. Speaker, I hope that I may be allowed to discuss, while the policy of the Canadian National Kailways is before the House, certain matters which particularly concern the constituency which I have the honour to represent in this House, the county of Charlevoix-Montmorency. Some years ago the Government passed legislation for the acquisition of the Quebec and Saguenay Railway from a certain point in the county of Montmorency to another point in the county of Charlevoix. Last year the completed portion of the railway was operated from the first of July until November. Murray Bay, or as it is called "La Malbaie," is one of the greatest summer resorts in Canada, and at once a large freight and passenger business was opened up, with profitable results to the railway. But for one reason or another, in the month of November all of a sudden I heard that the Government had decided to discontinue the daily train service and run only three trains a week. I inquired of the minister the reason for this change, and was told that it was in the best interests, of the country as the service was sufficient for the locality. All the local public bodies as well as the big industrial companies settled in that part of the country protested against the change, and I hold in my hand petitions, letters and other documents of protest which were at that time lodged through me with the Minister of Railways and the president of the Canadian National Railways. I also wrote to these gentlemen, and in reply was told that the action complained of simply had to be taken.
Mr. Speaker, it is not very often that I congratulate the Gvoernment, but they are entitled to my congratulations on the service they maintained until the month of November, for the trains were well operated and were profitable to the Government. But from the first of November up to the present day only a restricted service has been continued, with the result that all the good effects which followed from the daily train service are not in evidence to-day. I bring up this point in the hope that the Minister >of Railways (Mr. Reid) will evolve a new policy in regard to that train service from the first of May until at least next winter,
 -
by which time I trust the railway will be finished and completely equipped to run throughout the year.
In connection with the same railway, Mr. Speaker, I would like to say something further to my hon. friend the Minister oi Railways. Last year a request was made,- not by myself but by a big industrial enterprise in the county, the American Titanic Ore Company, the owners of a big mine,- for a branch line to be built nine miles north from Baie St. Paul to St. Urbain at a cost of $50,000 or $60,000, which would be a good feeder to this new railway. At the time the minister told me that a survey would be made and men would be sent to inquire about the possibilities of such a venture; but nothing has been done.
Another project has been brought before the Legislature of the Province of Quebec, and it is being supported by the people of my county and of the county of Chicoutimi, having in view pushing the same railway northward from Murray Bay to Chicoutimi. May I be permitted to say to the hon. Minister of Railways that I have not looked into this matter, but engineers of his department -men whom I know he holds in the greatest esteem-have told me that if this extension were made it would certainly bring a lot of business to the Quebec and Saguenay Railway, and the profitable traffic would be quite sufficient to pay the interest on the capital expenditure. I may add, Sir, that the projected extension would reduce the distance from Chicoutimi to Quebec by about forty-five or fifty miles. This district contains great lumber industries as well as manufactories of different kinds, so that such a line would at once get a great deal of traffic and at the same time act as a stimulus to local industry.
When the management decided last fall to take away the daily train service, I was assured by the Minister of Railways that the Government would sooner or later take over the entire railway and operate it as part of the Canadian National system. Later on I was told that this policy was not carried out on account of a certain little accident that happened on the railway. I have inquired from many people in my county if such an accident ever took place, and they have told me that this was not the ease, and they are most reliable people. While the engineers and contractors are still engaged in completing this railway I would urge upon the minister to come down and see that part of the country and meet the people, and I am sure that if he does so he will on his return take the necessary steps

to have these two branch lines immediatelj constructed.
The Minister of Railways towards the end of his speech pointed out that in a few years to come the Canadian National Railway system will in his opinion, he able to show a surplus. As the hon. member for Pontiac (Mr. Cahill) has well said this afternoon, there is freight in abundance everywhere in the province of Quebec, as well as in the other provinces, and the only thing the Government has to do is to go where the freight is available and so secure a good revenue. But, Mr. Speaker, I have one thing to object to in regard to the Canadian National Railway management-it is that men from the province of Ontario, such as Mackenzie and Mann, or, if they are not themselves in charge of affairs, their own agents and right bowers like Mr. D. D. Hanna and Mr. Mitchell, and others connected with them, are still in control of the system. I do not believe that people from other localities who are not at all conversant with the needs of a special district can themselves without personal inspection acquire a knowledge of its needs, and the president does not carry conviction by issuing orders from the province of Ontario or from the city of Ottwa and saying, "All goes well because I say so, and I am correct because I am paid a salary of $25,000 a year."
The minister has said that the rates charged by the Government railways were all light; that they might be increased a little later, but that they would be the same as those charged by other railways. I may be mistaken, but I have always thought that the rates changed by railway companies were fixed by the Railway Commission. Replying to a question which I put some time ago regarding the rates prevailing on the new railway in my county, the Minister of Railways informed me that these rates had been fixed by the officials of the Canadian National Railways. I am informed upon good authority that these fates are higher than the rates charged upon certain other railways for the carrying of goods over the same distances. For instance, $15.66 is charged for carrying fifty bags of cement which, carried over the same distance on other railways, would cost 10 cents per bag. Ten cents per 100 pounds was charged for one carload of hay shipped from Montreal to Quebec, a distance of 180 miles, whereas 14 cents per 100 pounds was charged for the same load from Quebec to Baie St. Paul, a distance of 60 miles. The charge for carrying a barrel of apples from
Quebec to Baie St. Paul is $1.70; I believe that is too high.
Last fall I took up with the Minister of Railways the matter of remedying the conditions existing through the lack of adequate railway facilities between Quebec and Murray Bay, and also the Railway Commission. I was informed by the Railway Commission at that time that they had no control over the railway operating between these points because the Government had not taken official charge of it. On the other hand, I was told by the minister a few days ago that the officials of the .Canadian National Railways had themselves fixed the rates charged on this railway. I would like to know what is the position in regard to this railway. One day we are told that the Government owns it, and then when we try to avail ourselves of that very fact and endeavour to have certain conditions remedied through their being brought before the proper board, we are told that the board has no jurisdiction.
The Minister of Railways spoke also about certain improvements made at Quebec and at certain other places. He said, for instance, that a huge sum of money had (been spent at Quebec and on the St. .Charles river. I was at the city of Quebec some time ago, and I do not believe that the Government have done all that they should have done at that place. As another hon. member dealt with this matter a few days ago I shall not go into it on this occasion, except to point out that this district seems to have been entirely neglected. Last autumn I was at Levis, right opposite Quebec, and I found that no station had been built there or even commenced. During the last five or six years the people of that place have only a kind of shack to serve as accommodation while waiting the arrival and departure of trains. I am told that there is a great need of repair on that part of the Canadian National Railways which is known as the Intercolonial. I travelled a good deal last year on the railway between Riviere Ouelle and Montreal; never in my life have I known the trains *[DOT]on that line to be on time.
I do not believe that the Government Railways can compete with the Canadian Pacific. The servants of the Government will always be the servants of the Government; we shall never be able to get from them the same service that is iendered by the employees of private concerns.
I wish to call attention also to the fact that there is no decent, safe and adequate station accommodation for those who use

the Canadian National Railways at the city of Quebec. I put a question on the Order Paper the other day inquiring of the minister whether the Government had considered the advisability of taking oyer the Quebec, Montmorency and Charlevoix railway and linking it up with the Canadian National Railways, the old Canadian Northern, and with the Quebec and Saguenay. [DOT]He told me that this was still the'intention ,of the Government; I hope that it will be done as soon as possible. I was told that negotiations had been carried on for the acquisition of this railway, but for one reason and another it has not been acquired. It is not for me to dictate the policy of the Government, but here we have a condition where the Government operates a railway out of Quebec a certain distance, and from Quebec to St. Joachim, a distance of thirty miles on that line, they are not the owners of railway serving that district. So far the acquirement of part of this line Quebec and Saguenay was a good step, but the Government should do better and acquire the rest of the line in order that they may have a direct' line from Quebec to Murray Ray.
I directed the attention of the Government to the need for the building of stations along the line between Quebec and Murray Bay, and they said that they would [DOT]inquire into it. As is always the case when that reply is given, we heard no more about the matter. We are always told that the Board of Management of the Canadian National Railways will give attentive consideration to any representations made to it from different parts of the country. But I have found that it sometimes takes three or four months to get an answer to letters which I have sent to them concerning railway matters. I do not know how the system is run; whether there is a head office in Toronto, in Ottawa or in Quebec. But I do know that in Montreal there is a gentleman named Mr. Brady who represents the department and very often when I send him a communication I receive a reply to the effect that he will communicate with Ottawa or with Toronto; and I hear no more about it-that is the end of it.
I will not detain the House much longer; but in connection with the present policy of Government ownership of railways, I do not believe it is feasible or possible at present to bring under decent control and management all the different railways which the Government has acquired, unless absolutely right away, immediately, all the people from near and far who had anything

to do with the Canadian Northern railway before, are done away with. We heard that Mr. D. B. Hanna is the greatest railway man and exponent of railway problems.
I believe what the Government may say; but if up to date, Mr. Hanna had been so big and great as that, he certainly would have been retained by other big railways in the United States, as was the case with Mr. Gutelius who was manager and chief engineer of the Canadian Government railways previously. I do not really believe that the employees and the men who are at the head of this famous Canadian National Railway Company to-day are up to much, and we should immediately pay the best salaries possible, without looking at the amount, in order to get the most efficient men and the most efficient management.


[Stage Direction]
Motion agreed to, and the House went into Committee of Supply, Mr. Boivin in the Chair.


[Stage Direction]
Railways and Canals, chargeable to collection of revenue-Canadian Government railways, toward deficit of working expenditure for nine months ending December 31. 1920. the management of the railways being hereby authorized to apply the receipts and revenues toward payment of the working expenditure, $5,000,000.
Mr. ROBB:: Before we take up this Estimate, I should like to hsk a question of the minister. There is a statement made that on the 1st February, the number of Canadian freight cars in the United States was forty thousand odd and on the same date the number of United States freight cars in Canada was 24,000 odd, leaving a surplus of Canadian cars in the United States of 16,109. On the 1st March, the number of Canadian freight cars in the United States was 59,000 odd and the number of United States cars in Canada was 40,000 odd, leaving a surplus of Canadian freight cars in United States of 19,084. I understand that while the United States Government is giving back to the railways the control of their roads-the United States Car Service Commission continues to administer the service of freight cars until the 1st May. If that be true, it seems to me that the Canadian Government should be able to represent to the United States Government that we should have a fair reciprocity in freight cars. I am sure the minister will agree with me that it is

very necessary at this time that we should have cars to move Canadan products.


John Dowsley Reid: Everything that I personally or the Government or the railway companies could do to try to get our cars back, has been done. Through the British ambassador at Washington, we have urged the United States Government to give us back our cars; the Canadian Railway Association at Montreal have done everything that they could possibly do, and the heads of the different railways have been pressing the United States to return their cars. We have, however, so much to ship out that as fast as the United States railways return the cars, those cars are moved back into the United States and are retained there. There is a great shortage of cars in the United States at the present time, the railways in that country being short from 100,000 to 150,000 cars, and they will not let us have their cars. Nothing more could be done than has been done by the Government through the ambassador and by the railways acting through their organizations.


William Lyon Mackenzie King: I want to ask the minister a question in reference to a clause in the Grand Trunk Bill which was before the House last session and a clause which appears in the agreement between the Grand Trunk and the Government. At the last session of Parliament when the Bill was before the House, the following clause was in the Bill and was subsequently stricken out when the Bill was in committee:
The Government may lend to the said Committee of Management, upon the notes or other obligations of the Grand Trunk, such sums as the Government may from time to time deem necessary to the carrying on or operation of the Grand Trunk system.
Exception was taken to that clause on this side of the House, and the minister consented to its withdrawal. In the agreement there is a clause which is not in exactly the same words, but which seems to have very much the same purport, and it reads as follows:
The Managing Committee may. with the consent of the Governor in Council, borrow from the Government on Grand Trunk notes, or other obligations or securities approved of by the Governor in Council, for the carrying on of the operation or improvement of the Grand Trunk system.
In the opinion of the minister, is there any difference between these two clauses, and if so, what is the nature and extent of the difference?


John Dowsley Reid: I am hardly in a position to give the hon. member an answer, because that is more of a financial question, and the Minister of Finance, if he were in his seat, could probably give a better answer than I could. As I understand the matter from reading this clause, that was intended to assist in financing the Grand Trunk railway, but the assistance is to be given only after the money is voted by Parliament. As I understand it, no money has been voted by Parliament for that purpose, and, therefore, no action has been taken up to the present time as regards giving any money to the Grand Trunk railway under that clause.


William Lyon Mackenzie King: Do I understand from the minister that under this clause in the agreement between the Government and the Grand Trunk, no money will be advanced to the Grand Trunk unless an appropriation is first made by Parliament for that purpose?


John Dowsley Reid: That is the way I understand the matter. Of course, I am speaking subject to correction pending discussion of the matter with the Minister of Finance.


William Lyon Mackenzie King: I suppose we may refer to the matter again when the Minister of Finance is in the House.


John Dowsley Reid: Yes.


Mr. DEVLIN:: I want to call the minister's attention to the statement which he made when the hon. member for Chateau-guay-Huntingdon (Mr. Robb) raised the question about Canadian cars being held in the United States. If I understood the minister aright, he stated that the Canadian authorities had done everything possible to get those cars back, but that they had not succeeded. If a person, having got property legitimately at first, holds it against the owner's consent illegally and without the intention of returning it, he is subject to being accused of theft.


John Dowsley Reid: But he is not holding it illegally. There is an international agreement that where a cay is on a foreign road, that road pays a per diem allowance for that car until it is returned to the original road that owned the car.
. The American railways are not holding those cars illegally, but it pays them to pay that per diem allowance rather than return our cars. The British Ambassador and Mr. Mahoney, who is connected with the Board of Commerce at Washington, are



making the strongest possible recommendations to get the ears back.


Emmanuel Berchmans Devlin: Is there any understanding between the British Ambassador of Washington and the American companies as to a limit within which these cars shall be returned?


John Dowsley Reid: No.


Emmanuel Berchmans Devlin: Would the minister be willing to place on the Table all the correspondence that has taken place between the British Ambassador and the other parties relative to the steps that have been taken to get back Canadian cars?


John Dowsley Reid: I have no objection. The American Government has been urging the railways to return the cars, but the companies keep passing them from one road to another. No one road keeps the cars for a great length of time, but altogether they remain over there a long time. When they get the cars there they keep them. The. trend is more from Canada to the United States.


Emmanuel Berchmans Devlin: People want cars in this country, and the minister has to furnish them. If the minister could get back the Canadian cars on the other side, would that save any part of this item of $5,000,000?


John Dowsley Reid: No. We have another item providing for the purchase of new cars. If we got 14,000 cars back we would not require to order so many new ones. But the products of Canada must be got out. The hon. member for Pontiac (Mr. Cahill) was complaining because he could not get cars to take pulp-wood from the Transcontinental to the other side. If we allowed these oars to go over there, we would not get them back.


Emmanuel Berchmans Devlin: If the minister could get back these 14,000 cars it would effect a great saving to the Canadian people. Is there anything in the form of an agreement by which the Canadian people will be compensated for the holding of these cars on the other side?


John Dowsley Reid: All we get is a per diem allowance, just as we have to pay a per diem allowance on American cars, but our railways get more revenue from this source on account of the adverse balance.


James Alexander Robb: The minister has just told the hon. member for Wright that the reason why the people of the Abitibi district are not supplied with cars to move their freight 
is because it is the deliberate policy of this Government not to supply cars that would go to the United States, because they would not get them back. Is that the policy of this Government in connection with all business in Canada, as regards grain, for instance? Let us follow the minister's statement to a conclusion. The hon. member for Pontiac this afternoon made the statement, supported by affidavit, that there were up in the Abitibi country 6,500 carloads of freight ready for the railway. The minister himself has told us that there are two ways of getting increased revenue for the railways; either by increased rates, or increased business. In this case the business is there. According to this statement, supported by affidavit, there are approximately 200 trainloads of freight waiting for transportation. The same condition exists all over the country. In Western Canada the grain is ready to be moved. Is it the deliberate policy of this Government not to supply cars for carrying wheat, oats, lumber, hay and other products of this country to the United States?


John Dowsley Reid: No. Our policy is to serve Canada first; in other words, to look after interprovincial traffic. We require a certain number of cars for our own needs :n Canada, and if there is any surplus we use them for international traffic. What we have been urging the United States Government and the United States railways to do is to let their cars come over here and get this traffic. The hon. member will see that it is absolutely necessary to have a certain number of cars in Canada for our cwn business. If we were to act on his suggestion we would not have any cars in Canada at all.


James Alexander Robb: Why?


John Dowsley Reid: If you send these two hundred trainloads-	,


James Alexander Robb: Does the minister claim that all this traffic in the Abitibi district is intended for the United States?


John Dowsley Reid: If it is not, there is no trouble about cars. If we were to look after international trade, we would not have sufficient cars to take pulpwood, for instance, from some part in Canada to the mills where it is manufactured; we would not be able to take paper from Chicoutimi to Montreal. We have to protect first our own people in Canada, and use whatever surplus cars we have for international traffic.


William Henry White: The minister claims there is no trouble within Canada. Let me

tell him that cars shipped with wheat last November were not reported in Winnipeg on the main line of the Canadian Northern when I came down here on the 26th of February. In the period between November 1 and February 26 the cars had not arrived at Winnipeg, and that is the condition everywhere in the West. I pointed out to the minister the other day that of the few cars we had available in the Peace River country, 76 were standing on a side-track, of the Canadian National railways, for some three months and have never been moved in that time. I know that for a fact. Owing to the lack of cars we were unable to get out our grain. Some of us were lucky enough to secure cars last fall, but we were not able to get the grain transported even to the nearest point of inspection at Winnipeg. I know several cases of that kind. Furthermore, in the Edmonton district I have been unable to sell one bushel of grain since last fall for the simple reason that the elevators were, filled at threshing time, and they were unable to get cars to relieve the congestion. The elevators were still full at the time I left. I do not think that bears out altogether the statement of the minister that there is no trouble at all if the cars are not going to the United States. The trouble is on the main line, and the minister can very easily obtain information on the matter. We have had no markets along the line of the Canadian Northern in Alberta because the elevators have been filled and cars have not been available to relieve the congestion.


John Dowsley Reid: This is the first complaint I have heard this winter with reference to the operation of this railway. There may be other complaints, but they have not reached me.


William Henry White: The primary cause of the trouble was that the elevators were filled at threshing time and transports could not be obtained to relieve the congestion.


John Dowsley Reid: The hon. member will see that the congestion begins at the seaports-Halifax, St. John, Portland or New York-and keeps backing up, with the result that the elevators are filled. It must be obvious that we could not supply cars to be used fpr storage purposes.


William Henry White: I was answering the point made by the minister that there was no trouble except one of an international character.


John Dowsley Reid: The point I wish to emphasize is that' there is a great quantity of produce that has to be moved backwards and forwards between the provinces, and we try to protect that traffic first by having sufficient cars to move it.


William Henry White: Probably the reason why the minister has not received more complaints is the statement of the railway authorities that they could not give cars to relieve the congestion owing to the feed shortage in the South, which called for the use of cars for transporting feed thither from the North. We accepted that statement, considering that, in view of the seriousness of the situation, it was perhaps only right that the live stock should be saved.


James Alexander Robb: Before six o'clock I want to put a question on record. What is the per diem rental charge on cars between different routes? How long is the contract made for, and when does it expire? Further, is the rental based on an estimate sufficiently high to cover reasonable interest on investment?


John Dowsley Reid: Ninety cents a day is charged on each side forty-eight hours after the car has arrived, and that is unlimited. We cannot force a car back.


James Alexander Robb: Is this arrangement from year to year?


John Dowsley Reid: The rates are revised from time to time.
At six o'clock the Committee took recess.
After Recess.
The Committee resumed at eight o'clock.


Georges Henri Boivin: When the Committee rose at six o'clock we were considering item No. 335, a vote of $5,000,000 for the Canadian Government railways'. Shall the item carry?


Mr.   GAHIEL@: The minister stated before six o'clock that the Government had done everything in their power to get cars returned from the United States. About a year ago I brought this question up in the House, and the Government then promised that they would undertake to make some arrangement whereby these Canadian cars would be brought back from the other side of the line. During the past year the United States Government had control of all the railways in that country, and I would like to know if there has been any attempt on the part of this Govern-

ment to arrive at an understanding with them-an understanding between the two Governments rather than between individual railway companies-as to an exchange of these cars, and whether the Canadian Government will take the responsibility of seeing to it that Canadian cars shall be returned to this country.


John Dowsley Reid: Perhaps the hon. gentleman was not in the Chamber before six o'clock when I made a statement on this matter. The Canadian Government communicated with the British Ambassador at Washington with a view to his taking the matter up, and he is doing all that he possibly could. In addition to that we have a representative of the Board of Commerce in Washington who has been endeavouring to arrange the matter with the railway organization at the United States capital. Likewise, our railway association at Montreal, together with President Beatty of the Canadian Pacific railway, and President Hanna of the Canadian National Railway system, have been using every effort to bring about, an improvement of the existing conditions, to say nothing of messages which the Minister of Railways and other departments have been forwarding. I promised to get all the correspondence and lay it on the Table. The Deputy Minister of Railways has already received instructions to obtain all the information available in order to show what efforts have been made to get the cars owned by Canadian railway companies back into Canada.


Mr. J. E. ARMSTRONG:: Seeing that we have 4,000 cars in the United States, is it not possible to have the per diem allowance increased, and have it not only doubled, but trebled? The cost of cars has increased three or four (times over what it was a few years ago, and surely there ought to be some way of making the allowance for these cars three or four times more than it is to-day. The nominal sum that is at present charged is a snap for the United States companies that are using our cars; but if the allowance were increased three or four times it would in all probability produce better results.


John Dowsley Reid: The per diem charge was formerly sixty cents and it was increased to ninety cents.


Joseph Elijah Armstrong: That is of no avail.


John Dowsley Reid: 
Joseph Elijah Armstrong: I would suggest $2 or $3 a day.


John Dowsley Reid: In that case how would you collect the amount from the companies over there? They have the cars and we cannot get them back until they are prepared to return them. For our railway companies to start quarrelling with a company on the other side would, I am afraid, result in complications that would not be to our advantage in the long run. I think I am quite safe in saying that the (Canadian Pacific, the National railways, and the Grand Trunk, are all just as anxious as they can be to get the cars back, and they are making every exertion to do so. The fact of the matter is that the Canadian Pacific and the Canadian National railways are compelled to buy more oars because of the shortage in Canada caused by Canadian cars being in the United States. The Government and the Canadian railway companies are doing all they can, and I do not think that any further effort can be made beyond what is being resorted to up to the. present time.
Mr. J. E. ARMiSTRONG: This matter has been going on for several years. The sum of sixty, or even ninety cents, per diem, is such a small amount in comparison with the capital invested in a car that the authorities on the other side of the international boundary line should not be annoyed if they are charged $2 or $3 per diem in respect of cars that are not returned. With such an allowance as that Canadian railway companies would be in a position to possibly pay the interest on the cost of building cars in this country.


John Dowsley Reid: In that case the United States railways might say: We will not exchange cars; if you are going to charge that rate we will not tranship your cars on our road. Suppose a dozen cars arrived at Niagara Falls, New York, and we said to the American company: The per diem charge for those cars is $3 or $4 a day; they would simply say: If you do not want to comply with the rules in the United States we will not take your cars. In that case what could we do?
Mr. J. E. ARMiSTRONG: Is the minister taking up with the American authorities the question of increasing the allowance to $2 or $3?


John Dowsley Reid: The railway companies themselves have taken it up and we have discussed every phase of the matter with them in the hope of getting the cars back. It is

the interest of the railways and. the public that guides us as to what is best to do.
, Mr. BELAND: This is a very serious question indeed. The trade figures show that Canada has imported in the past year about $300,000,000 worth more than it exported. That would in itself .indicate that there should be many more ears in Canada from the United States than there are Canadian cars in the adjoining republic. May I ask the .minister whether it has not been the policy of the Canadian railway companies, or of the 'Government National railways, to hold in Canada as many cars coming from the United States as possible in view of the fact that United States companies weTe retaining Canadian cars on the other side? In view of the trade figures I cannot understand why we should have fewer American cars on this side than they have of Canadian cars in the country to the South.


John Dowsley Reid: The hon. gentleman
will realize that it takes more cars to carry Canadian products such as pulp, and lumber, which are bulky in their character, to the other side.


Mr. BELAND:: But we import coal; we imported $40,000,000 worth. Then there are automobiles.


John Dowsley Reid: We are not holding any more cars to-day than are required for our own trade. However, this is a very important question and if hon. gentlemen agree I would like to have a day set apart for its discussion by the Railway Committee. If satisfactory to hon. gentlemen, I will arrange to have the railway representatives there to explain the situation and also present such information as can be got from the Railway Department. I can only repeat that the Government and the railway companies are making every possible effort to get our cars back, and we cannot put forth any more exertions than we are already doing to bring about that result.


Henri Sévérin Béland: I do not wish to controvert the minister's statement. I think the Canadian National railways, the Canadian Pacific and the Grand Trunk have tried all they can to get their cars back to Canada. However, can we not say of the Canadian National railways that they have been more lenient than American companies in that they have allowed American cars to go back to the United iStatets whilst their Own Canadian cars were retained in that country?	i '


John Dowsley Reid: What the hon. gentleman means is that we should hold more American cars in this country?


Henri Sévérin Béland: Certainly.


John Dowsley Reid: How are we going to ship pulp-wood to the United States if that is done? The hon. member for Pontiac (Mr. Cahill) has complained about pulp-wood along the Transcontinental railway remaining unshipped. We must send the cars back to the United States."


Henri Sévérin Béland: You must reverse the situation. How can the Americans ship large quantities of goods to Canada unless they have the cars? Because the minister must remember, they export to this country $300,000,000 more than we export to them. And these goods are not in the shape of diamonds or gold rings, which require but, a small amount of car space. For instance, besides coal we import $40,000,000 of automobiles, and $30,000,000 of machinery, traction engines, etc. This freight requires spacious cars.


William Henry White: I would like to know if the minister is prepared to answer the question that I put this afternoon but which was ruled out of order at that time; that is,, with respect to the extension of the Canadian Northern from Bruderheim to Whit-ford, Alberta.


John Dowsley Reid: My deputy tells me that we have no item in the Estimates for that work so far this year. However, the matter does not arise under this item, and before the item passes I will obtain more information. I have a memorandum before me and we will ascertain from the management of the Canadian National railways in Toronto if any further information is available. The hon. gentleman stated this afternoon that I made a promise at the meeting of the Railway Committee. It is hard to keep all these matters in recollection, but whatever promise I made would be on the strength of information given by the officials of the Railway Department at that particular time. I shall draw their attention to the statement now made by the hon. gentleman and before the item passes will endeavour to obtain whatever supplementary information is necessary.	*


William Henry White: My reason for pressing the question at this time is in view of the promise which was made. A delegation from the district was here at the time and the matter was fully discussed in the Rail-

iway Committee. The people of the district have been looking forward to the department making good that promise that was made, and I was asked to bring the question up and remind the minister of it. The people of that part of Alberta expect to get some definite information as to whether they may expect to get the railway extended into that section this year. The minister says there is no item. Am I to conclude from his statement that nothing is going to be done with the road this year?


John Dowsley Reid: Before giving a positive answer I would like to have an opportunity of further consultation with the management to see if I have overlooked it in their statement. I will give my hon. friend an answer .later on,


Frank S. Cahill: Before we get away from the question of car exchange I want to ask , *the Government if they have any policy in regard to the exchange of cars between the United'States and Canada. A few years ago we sent a deputation to Washington to negotiate a treaty, not through the British Ambassador, but directly on behalf of Canada. Is it not possible to negotiate another treaty with regard to the exchange of cars? There is rib question that this car shortage is going to continue, for we must export goods to the United States until at least we have balanced the trade situation. If the Government is not in a position to negotiate with the American Government, we must expect a continuance of the same confusion. The people I spoke of this afternoon, in the Abitibi district, will get no relief until this -situation is cleaned up, and if they are not going to obtain relief they might, as well know it and get out of the country.
There can be no question about the United States Government legislating so that arrangements may be made to get these cars back, and, of course, the Dominion Government has the same power to legislate for the return of American cars from this side. The minister points out that if you make the per diem charges $4 or $5 the American roads will not accept the cars. But there is no necessity to make that charge apply at once; it can be arranged to become effective after a certain lapse of time. But. there must be some arrangement whereby Canadian and American roads will exchange cars on a .more satisfactory basis than obtains today. It is not for the Railway Committee to negotiate between several hundred lines in the United States and in Canada; it is a question to be settled between the two Governments. I pointed that out last year, but 
apparently the old condition of affairs still exists. The minister says: Let this question be settled by the Railway Committee. It is not a question for the Railway Committee to settle; it is a question for the Government of B this country to negotiate with the Government of the United States to see if they cannot come to some arrangement whereby a settlement can be reached.


Mr. BUREAU:: I see that the item is:
Canadian Government Railways, toward deficit of working expenditure for nine months ending December 31, 1920.
That is next year. May I ask the minister what that working expenditure is based upon? I understand that this year we are having a deficit of $30,000,000, and from the newspapers I find glowing accounts of the progress our railway system is making, and the hopes entertained that our railway revenues will lift the entire burden of taxation from the shoulders of our taxpayers. Of course, I quite appreciate that the minister cannot answer every question of detail which may be put to him, but on the other hand these are supposed to ibe Government railways, and still more are they supposed .to be Parliament railways. The Government do not hear as much about bad operation of any of their railways as the individual member of Parliament through whose riding the railway runs, and the only case where the member can put his grievance before the authorities is here. Therefore I think that a field day in the Railway Committee will not amount to much, because we will merely get very glowing accounts from Mr. Hanna and the other officials-I do not blame them -to assure the people that their railways are being operated efficiently and to encourage their patronage. First of all, I want to know what to-day constitutes the Canadian Government Railways.


John Dowsley Reid: The Canadian Northern system, the Intercolonial railway and the Transcontinental Tailway. Answering the other question, how I arrived at that $5,000,000, the loss for the past fiscal year ending March 31, was $7,500,000. Now we are bringing the Transcontinental and the Intercolonial fiscal year to an end on December 31 the same as the fiscal year of the Canadian Northern and all other railways. So we estimate $5,000,000 as being the deficit for the year.	,


Jacques Bureau: While I am on my feet, Mr. Chairman. The other day I put some questions to the Minister of Railways- very simple questions that could have been answered yes or no, or very shortly. The

minister, as was his right, moved for a return. I got the return to-day. I am not going to deal with it in detail, but I will merely state the questions I put. They were:
Has an Order in Council been passed entrusting the said company-I was talking about the Canadian National Railway Company- with the management and operation of the Grand Trunk Pacific and Intercolonial railways?
The answer is no. The second question I put was:
If so, what is the date of the Order in Council ?
Naturally, there is no date. No Order in Council was passed. Then I put this other question:
If an Order in Council was not passed, why was such an Order in Council not passed?
There is no answer. I have this to complain of, Mr. Chairman. You can sue the Canadian Northern railway before the courts of your province and bring the case to trial; but if you try to sue the Transcontinental you find that it will take you a year to get a fiat-and I am speaking from experience. I understand the situation perfectly well. The Secretary of State sends the petition to the Minister of Justice; the Minister of Justice cannot pass on the facts unless he has them before him; therefore he sends the petition back to the Minister of Railways; the Minister of Railways sends it to Toronto, and those in authority in Toronto sends it down to Leduc or to some other headquarters of the Transcontinental, where they ask a man who knows something about lumber to cruise certain territory which has been burnt by the railway and make a report; the man makes his report, sometimes it is unsatisfactory, and a second report is called for; the report goes to Toronto, from Toronto it is sent to the Minister of Railways, and he sends it to the Department of Justice. In two instances, I do not know whether the reports were lost or what happened, but the cases did not go any further. I know of a case where the petition of right was served in July and the report was made in the following February. The cruisers went through the bush in February where the fire took place the preceding June. I admit the winter season is a better time for tramping through the bush on snowshoes and traversing the frozen lakes and rivers, but in my experience up the St. Maurice river I never heard of a cruiser going out during the winter, especially when the snow is high, to see what damage had been done by fire. '
I want to find out why the Transcontinental railway is not put in the same position as the Canadian Northern Railway system so that a man who suffers damage from negligence or any other cause whatever can go before a tribunal in the locality where the damage was caused and where all the witnesses live and have his case tried the same as if he was bringing an action against the Canadian Northern railway which is also a government railway. The Government has no more interest in the one railway than in the other, and I do not see what reason they can have for putting a litigant to all the trouble of waiting five, six or seven months before getting a fiat to bring his case before the Exchequer Court.


John Dowsley Reid: The reason is that the Canadian Northern railway is an incorporated private company, of which we are the stockholders. The hon. member will remember that we passed a Bill in a previous session whereby we are going to transfer them all


Jacques Bureau: Yes, I well remember you passed it by the use of the closure.


John Dowsley Reid: That is the reason it was such a good Bill.
The intention is to transfer all these railways to the Canadian National Railway Company, and then, of course, if there should be considered cause for action against the Transcontinental, such action could be brought just as can now be done in the case of the Canadian Northern. The hon. member is right in saying that every facility should be afforded to those who have just cause for action against the Government railway. Possibly there may have been delay in the case referred to; if the matter had been brought to my attention we would have facilitated the proceedings in every possible way. The delay in connection with the Grand Trunk acquisition has prevented us from taking the necessary steps to bring these lines under the Canadian National Railway' Company, but ultimately the Canadian Northern, the Transcontinental and the Intercolonial will all be subject to the one law so far as the bringing of action against them is concerned.


Jacques Bureau: I do not think that the minister expects me to take that as an answer or as a reason for the course that has been followed. The object of the incorporation of the Canadian National Railway Company was to put under one system of

operation and make subject to one law all the railways operated by the Canadian Government. Now, here is an anomaly; an Act is passed for the special purpose of bringing under one management the Transcontinental and the Intercolonial; yet neither of them is brought under that management. To say that you are waiting for the Grand Trunk is no excuse; you might as well say that you are waiting for the Chaudiere Falls Railway or for the St. Maurice Valley Railway. I do not want to be understood as criticizing the department, because I understand the difficulty that is encountered when reports pertaining to such matters as this have to go from the Secretary of State to the Minister of Justice, from the Minister of Justice to the Minister of Railways, from the Minister of Railways to the Toronto office, or to Moncton in the case of the Intercolonial, and so on. I simply want to point out how unfair it is >
to the man who suffers damages alleged to have been caused by a Government railway when he has to deal with two Government railways, one operated by the Canadian National Railway Company and the other not so operated, although it should naturally form part of the Canadian National system. It is true that the letters " C.N.R. " still appear on the sieves of the cars forming part of the equipment of the Canadian National Railway System; but let that pass. If we are going to have operation of Government railways by an incorporated company, let us have it for the whole system, including the Intercolonial and the Transcontinental. Great damage was caused in the St. Maurice region last year through the alleged negligence-as to that the courts will decide-of the Transcontinental; millions of feet of timber were burned because of that negligence. While on this question of operation let me refer to a condition which exists on the Canadian Northern line between Montreal and Quebec at a place called Glenada, where there is no agent. The next station is Grand'Mere; at that point there is an agent. As I came upon the train to-day it was directed to my attention that an unsatisfactory state of affairs prevails at this point. Ste. Flore, with a population of 3,000 people, is at the door of Grand'Mere, and the nearest point from which they can ship their freight is Glenada, but as there is no agent at Glenada, they have to ship to and from Grand 'Mere. But the Canadian Pacific station at Grand'Mere is on the level, and the Canadian Northern station is at the foot of the hill. If a man has to order a car of freight, 
instead of having it shipped on the Canadian Northern he gets it by Canadian Pacific in order to avoid the haul up the hill. If we had an agent at Glenada, we would get all that traffic and prevent it from being diverted to the Canadian Pacific. These things ought to be inquired into. I was told to-day that carload after carload of freight was being lost to the Canadian Government Railways because of our having no agent at Glenada.


John Dowsley Reid: I shall see that the attention of the management is drawn to my hon. friend's statement.


Mr. PARDEE:: The minister told us this afternoon that the loss on operating expenses is $14,000,000 and interest charges $19,000,000, making a total deficit of $33,000,000. What have these roads cost the country by way of deficits during 1919? By deficits, I mean outgo less income. What I want to get at is this: The Government had adopted the policy of Government ownership of railways. Having regard t& the fact that in past years we have put up large sums of money for the Canadian Northern, the Grand Trunk Pacific, and so on, will the minister say whether the present state of affairs is less costly to the people than the system previously followed?


John Dowsley Reid: Does my hon. friend
want the gross earnings?
Mr. .PARDEE: I want to know how the loss on Government operations compares with the result from private operations prior to 1919.


John Dowsley Reid: My hon. friend has the figures correctly. The loss on operating expenses was $14,000,000; the fixed charges on the Canadian Northern about $19,000,000. I mentioned also in my statement this afternoon that the loss on the Grand Trunk Pacific, which is not a part of the Canadian National railway system, was $5,000,000, to which should be added $8,800,000 for fixed charges, making a total of $14,000,000 on the Grand Trunk Pacific.


Frederick Forsyth Pardee: That is, $14,000,000 must be added to the $33,000,000?


John Dowsley Reid: Yes; that includes the Grand Trunk Pacific, the Transcontinetal, the Intercolonial and the Canadian Northern. I gave all the figures this afternoon.


Frederick Forsyth Pardee: What was the total cost to the people of Canada?


John Dowsley Reid: The loss was $47,000,000 during the past year.


Frederick Forsyth Pardee: Does that include maintenance?


John Dowsley Reid: Yes, and includes also
some $8,800,000 of fixed charges on the iGrand Trunk Pacific and $19,000,000 of fixed charges on the Canadian Northern.


Frederick Forsyth Pardee: So that the people of
Canada paid out during 1919 on account of the public ownership of railways, maintenance included, $47,000,000. Am I right in that?


John Dowsley Reid: No, that is hardly a
fair way to put it. Of course, during 1919-


Jacques Bureau: Put it, " for the luxury
of operating railways."


John Dowsley Reid: During 1919 the cost of operation of the Government Railways was increased by $19,000,000 for wages alone, and there were no increases given. Therefore, it is not fair to compare 1919 with the previous year, because in 1918 some increases in rates were granted. But if we take the situation as the hon, member has stated it, he is correct; those railways lost $47,000,000 last year.


Emmanuel Berchmans Devlin: Is that the total loss?


Mr. I. H. SINCLAIR:: I do not think the minister is putting the case strongly enough, because we are face to face with another rise in freight rates. It is not more than a year or two ago since the first increase in freight rates was made. I think there was an increase of five per cent in 1916, a second increase of fifteen per cent, and later on a further increase of twenty-five per cent. My recollection is that the rates have increased forty-five per cent already, and it looks as if we shall have another increase in order to meet the deficit. Therefore, public ownership is going to give us a deficit of $47,000,000 which the ratepayers of this country will have to shoulder, and in addition to that we are face to face with an increase in rates which will also be a burden on the people of Canada. I would advise the minister to increase the rates so that those people who are shouting for public ownership will understand what it really means, because they will have to pay for it. I do not see why the ordinary taxpayers of this country should be called upon to pay deficits incurred in the running of our railroads. The people who use the railways should pay for the railways. "Why should a man who lives twenty, thirty, forty or sixty miles from a railway,' as is the case with many people in my constituency, have to
pay for accommodation received by people in the larger places? It is not fair that this large deficit should be levied upon the general taxpayers of the country. The railways should bear their own burden, the rates should be put up in order that the bills may be paid. And after a while people will find out what public ownership is. Public ownership has been a failure in the United States; it has been a failure in Great Britain; it is a failure in Canada; and the sooner we come to learn the lesson, the better.
There is another matter which I want to bring to the attention of the minister and it is this. I listened carefully to his statement this afternoon, but I have no clear idea as to how we stand on this railway question. I suppose the minister has; but it will be necessary for him to prepare a statement such as is prepared by a joint stock company at the end of the year, showing his assets and liabilities, and his profit and loss account, and give it to the members of this House, so that we may know where we stand. The minister says that he has a deficit of $47,000,000, but that does not give us any information. Wo want to know where that money has gone; we want to know what assets we have, and the only way in which that can be put before us is by a regular statement like that prepared by a joint stock company. If the president of a joint stock company were to come before his shareholders with a story like the one the minister told us to-day and say that he had operated the business for a year and had a deficit of some $47,000,000, why, he would not be elected again, I am quite sure of that.


An hon. MEMBER:: Neither will Union Government.


John Ewen Sinclair: The minister must give a summary, of course; but when he gives us a regular bookkeeping statement-, showing his assets and liabilities and his profit and loss account, we shall be able to judge for ourselves. As the matter stands to-day we are not able to understand him.


John Dowsley Reid: The hon. member will probably find all that he has asked for in the statements that I did not read out today, but that will appear in Hansard. If he does not, I shall be glad to furnish any further information that may be required. With reference to public ownership, the Intercolonial railway, which is publicly owned, lost $7,500,000 last year in operation. Does the hon. member want to suggest that that road should be handed over

~ to a private corporation on account of its losing $7,500,000? The Canadian Northern lost only some $6,000,000 in the operation of .its whole system, whereas the Intercolonial lost $7,500,000 in addition to the interest on a capital of $125,000,000. What private corporation could we hand the Intercolonial over to now? The Grand Trunk Pacific was handed over to us; we could not help taking it over; what could we do with it? We could not close it down; no private corporation would take it off our hands, and we are compelled to operate it. When it was built we were responsible for it; we guaranteed the bonds. Therefore, it is impossible to hand back the roads that are really losing the most. No private corporation wants the Grand Trunk Pacific, and I do not think the people in the Lower Provinces would agree to handing over the Intercolonial to a private corporation even though it has lost $7,500,000 plus the interest on the capital. For myself, I would not want to hand it over; it was built to connect the Eastern Provinces with the Western Provinces, and I want it kept In the name of the people of Canada.


John Howard Sinclair: The minister need not try to frighten me with the Intercolonial because I have no doubt that if the Intercolonial were put into the hands of a private company, it would do better than it is doing to-day. The Intercolonial was one of the bargains entered into at Confederation; it was one of the terms on whidh the Maritime Provinces came into this union. If the Maritime Provinces desire to keep the Intercolonial as a government owned road and to compel the Dominion of Canada to live up to its bargain, I will not object to that; but no enterprise of this kind pays and it is impossible to make it pay under Government ownership, because it is inherent in the management of railways that men have to act quickly; they have some times to take chances; they have to conduct business in a way that it is not suitable for a Government to do. The Intercolonial has not always paid in the past; but I know a few occasions when it did pay under good management, and it should have paid better during later years than it has done. I do not know that I can point out the reasons why it has not paid, but the minister ought to know why it has not paid better than it has.


John Dowsley Reid: The reason last year was on account of the increase in wages, which added a large amount to the deficit; and during the war the increased cost of
[;Mr. Sinclair.]
operation was on account of the increase in wages and rates were not advanced in a corresponding ratio.


John Howard Sinclair: I understand that the rates in Eastern Canada are higher than those in Western Canada. If I remember aright, when the rates were raised in 1916, the increase applied only to districts east of Port Arthur; the rates in Western Canada remaining the same. If it be true that the eastern section of the railway is on a higher scale than the western section, that is a reason why the minister ought to have made the eastern section pay better than it has paid. I have no doubt whatever that the money has been wasted. The minister has not told us that a profit and loss account would appear in Hansard. If it does, we shall be able to examine it to-morrow morning; but if there is not a straight bookkeeping account for us to examine, the minister should not ask us to pass this item until he submits a statement of that kind.


John Dowsley Reid: I think my hon. friend will find the information on Hansard. If not, of course, I will give him any information he wishes. The hon. member, I think, stated that the Canadian Pacific Railway gave a statement of their earnings weekly. The Canadian National Railways have been doing the same thing. Their earnings are published in the trade papers. The Canadian Pacific, I believe, send a card showing their earnings to all their shareholders.


Frank S. Cahill: What amount was paid
out of earnings on account of maintenance and upkeep?
* Mr. J. D. REID: According to the statement I submitted, the operating expenses were $60,034,018.
i Mr. CAHILL: That is not what I want. According to the minister's statement, the deficit on account of interest charges and operating expenses amounted to $47,000,000. Now if there is a deficit in operation you could not, of course, take any money out of earnings and put it into maintenance of way or upkeep.
. Mr. J. D. REID:	If the hon. member
wants the items under the heading of Maintenance alone, I cannot give him those figures this evening.


Frank S. Cahill: Let me put my question in another way. There is such a thing as the maintenance of'way of railways. The roadbed has to be kept up to a certain

standard; new ties, new rails and fittings have to be put in. In the statement of the Canadian Pacific, for instance, I find that for the year 1918 they paid on account of maintenance of way, new structures, and so on, $28,000,000, and on maintenance and equipment $22,000,000, making a total of $50,000,000 spent out of earnings. After deducting this amount from their net receipts, there is a surplus of. $24,000,000. The receipts are not considered as earned until they have maintained the road in an efficient condition. The minister stated this afternoon that 78 per cent, I think, of the receipts on the Government railways was paid out in wages. The railways must also consume coal, for instance, and if 78 per cent of the receipts was paid out in wages there would be very little left for maintenance of way. What I want is a bookkeeping account, to show where this money that was received went to.
, Mr. J. D. REID: I would ask my hon. friend to let his question stand, and I will get the details a little more fully.


Frank S. Cahill: I am quite willing to do
that provided the minister will report progress.


Jacques Bureau: The minister ought to
know under what heading maintenance expenses are charged. Are they charged to capital or to operation? Such items as maintaining the roadbed, for instance?


John Dowsley Reid: Any expenses in connection with renewing or repairing the old roadbed would be charged to operation, not to capital.


Jacques Bureau: Were such expenses
charged to operation in 1919?


John Dowsley Reid: Yes. Those expenses
,are charged to operation before we get the net receipts.


Mr. DENTS:: Referring to the question
of maintenance, I should like to supplement the statement made bj the hon. member for Three Rivers (Mr. Bureau) a short time ago. He stated that on the Canadian National between Montreal and Quebec there weie stations without agents.


Jacques Bureau: And agents without stations.


Mr. DENIS:: More than that, there are stopping places, which should be stations, where absolutely no shelter for freight or passengers is provided. In the county of Joliette, for instance, there is a stopping place called St. Pierre, which is situated
in a very densely populated section. There is no shelter of any kind there, and up to last fall there was no road provided by the Government to the place where the train stops. I have been corresponding with Mr. Hanna in regard to this particular place for about a year, but have had no success whatever. I would ask the minister to see that some shelter is provided for the public in places so thickly populated as the county of Joliette and at such stopping places as St. Pierre, which is about nine miles from the city of Joliette. How can human beings, be expected to stand out in a field, in the open, at all seasons of the year, and especially in the winter months when the temperature is sometimes thirty below zero, waiting for the Government train-and unfortunately these trains are very often late? We are all aware that the trains of the Canadian National between Montreal and Quebec are running late most of the time, especially in winter, and you can easily imagine the plight of these people standing out there in an exposed place without shelter. I hope this will strike the minister as being a proper and a reasonable representation to make, and I should like him to give me the assurance now that something will be done to remedy the situation.


John Dowsley Reid: I shall bring this matter to the attention of the management. Of course, I have not the power to order the erection of shelters wherever they are asked for, I can only lay the matter before the management. I am sure, however, they will consider cases of this kind favourably provided financial conditions warrant the expenditure. I think from what I have learnt from hon. members and the public generally that there has been a great improvement during the past year along the whole system. The management are doing all they can to remedy as quickly as possible conditions such as my hon. friend has mentioned.


Jacques Bureau: So are we.


William Lyon Mackenzie King: This afternoon the minister commented rather favourably on the widening of the gauge of the Prince Edward Island Railway between Charlottetown and Summerside. I should like to ask if it is the intention to proceed with the widening of the gauge over the entire system.


John Dowsley Reid: We shall not proceed with that work during the present year. By standardizing the gauge between Char-

lottetown and Summerside we can take care of about 75 per cent of the trade of Prince JSdward Island. As soon as financial conditions will permit standardizing the gauge of the rest of the railway on Prince Edward Island that work will be proceeded with, but not this year.


William Lyon Mackenzie King: It is an expense that is inevitable, and there would seem to be very little ground for not proceeding with it now":	At present 25 per
cent of the Island is without the accommodation it should have. That means a double shipment of all freight carried over the narrow gauge. I would strongly urge the minister to reconsider the matter and see if it not possible to proceed with the widening of the gauge
over the entire system.
/


John Dowsley Reid: I am afraid we cannot consider this proposal this year. The other parts of the island have the narrow gauge system, and the only inconvenience is involved where there is trans-shipment. This, however, is not so serious because it is done by the railway officials at Charlottetown and Summerside. The widening that has been so far done is of great advantage, and I quite appreciate the necessity for completing the work over the whole system as soon as possible. But financial conditions, we felt, would not justify our doing it during the present year. Now, Mr. Chairman, as I have an important appointment which I should like to keep, and as the Minister of Naval Service (Mr. Ballantyne) is prepared to go on with his Estimates, I should be glad if the Committee would pass this item.


Some hon. MEMBERS:: No, no.


Jacques Bureau: We can Teport progress, and the minister may leave.


John Dowsley Reid: I move that further consideration of the item be postponed.
Item stands.


[Stage Direction]
Amount required for the construction of vessels in accordance with Government programme, $20,000,000.
Charles Gavan Power: May I ask the Minister of Railways (Mr. J. D. Reid) to remain during the discussion. We found him so useful to us on the last occasion that we would appreciate h:s advice again.


William Lyon Mackenzie King: I should like to refer again to the law of the country 
and the way in .which these contracts have been awarded, but I desire to do so in the presence of the Acting Prime Minister (Sir George Foster), because I think the matter is important enough to call for a statement from the leader of the Government himself.


Charles Colquhoun Ballantyne: I think I can satisfy the leader of the Opposition (Mr. Mackenzie King), as well as other hon. members in this matter. I fully explained the other evening the reasons why we let the contracts in the way in which we did; and with particular reference to the legal phase of the question, I showed that where an emergency exists the Government are justified in placing contracts in the way they did in connection with our shipbuilding programme. I am sure hon. members will agree that there was a two-fold emergency. In the first place, the war was on and the Government were anxious to get the ships; secondly, we were exceedingly desirous to keep men employed in the various yards from Halifax to Prince Rupert. I announced the other night that the Government shipbuilding programme was at an end, and in connection with any further contracts that may he let we shall follow the law and call for public tenders, as no emergency now exists. I am quite sure that this explanation will satisfy my hon. friend.


William Lyon Mackenzie King: This item involves a sum of $20,000,000 which is a very large sum, and I would ask the minister if it is not possible, in connection with any portion of this amount, to call for tenders for the work that is to he done. Twenty million dollars is a big proportion of the total estimates for public works, and I might point out to my hon. friend that the total expenditure on this single matter is something like $70,000,000, an amount equal to the total expenditure of Canada only a few years ago. That all of this work should be done without tenders being called for in connection with a single contract, when the statute expressly provides that no contract exceeding $5,000 in amount shall be awarded unless public tenders are called for, seems to be a serious violation of the law of the land and one which even the minister himself will' find it difficult to justiffy.


Charles Colquhoun Ballantyne: I was under the impression that I had fully covered the ground the other night, but I shall be glad to do so again. As I said a moment or two ago, the war was in progress and Canada wanted ships Ibadly, and to have called for public tenders at that time would have meant

that two or three yards might perhaps have quoted at a lower rate than the other yards throughout the country; and if the Government had placed an order with, say, three yards that had only six berths, there would have been a serious delay in getting the ships. Furthermore, there was the labour situation to be considered. After all, however, the paramount question is this: Has the public interest been as fully safeguarded by the system which the Government adopted during the war and the reconstruction period as if public tenders had been called for? I take it that this is the question which the leader of the Opposition has in mind. I assume that he desires to be assured, and to have the public assured, that these ships were ordered at as low prices as if public tenders had been called for. Well, let me assure the hon. gentleman as well as other (members of the House that no lower prices could have been obtained had public tenders been called for in the usual way. Indeed, I will go further, and say that these ships were ordered at lower prices than if tenders had been called for. Hon. members who come from cities where shipbuilding yards are located know full well that I did not accept the first price that was quoted me by any of the shipyards. I had prices checked up as to cost, and exercised all the business ability of which I am possessed, whatever it may be worth, as well as the lability of the technical officers who were associated with me, in order that we might reduce the prices to, as low a point as possible. I made as close a bargain for the people a,s I possibly could, and I am thoroughly satisfied as a responsible minister that these ships have been orderd at lower prices than if public tenders had been called for. I have fully explained the reason for the deviation from the law. The emergency existed; it was imperative that the ships should be turned out; we were in a hurry for them; and if I had followed the advice which has been preferred by the leader of the Opposition the Government would not have to-day thirty ships in commission. Byfollowing the system which we adopted we got the ships in half the time that would have otherwise been required. Furthermore, the yards employed 25,000 men, and we wanted to distribute the contracts evenly amongst all the yards throughout the country. I am sure that hon. members will agree that the emergency, and the war conditions that existed at the time, as well as the desirability of giving employment to all of these 25,000 men, most of whom
are returned soldiers, justified the Government in seeing to it that the shipbuilding programme was evenly apportioned. I have no regrets as to the manner in which the contracts were placed. I think they were placed properly in the public interest. Our programme, as I stated the other night is now finished. Any further orders that the Government may have to give will certainly be awarded in accordance with the law, and after public tender. I am quite satisfied to do that, I wish to follow no other policy. The law is there, and if there is no emergency I must follow the law. The Government must also observe that course. I am thoroughly satisfied that if we were ordering more ships and do so by public contract, the people of this country would pay more for those ships than was the case under the system of ordering which the Government adopted.


William Lyon Mackenzie King: I realize that no good purpose can be served in a discussion of what was done during the period of the war. The war is made to cover a multitude of sins, and so far as the Government's violation of the law of the land in awarding these contracts is concerned, I iam quite prepared to allow the minister to use the war as an excuse as regards any emergency that may have existed at that time. But the war has now been over for sixteen months, and I am not sure from the minister's statement that contracts have not been awarded since that time. The point I am particularly anxious to make at the moment is, that we are asked now to vote another $20,000,000 not for any expenditure to be incurred as the result of an emergency, but for expenditures to be incurred during the coming year. I would therefore like to know from the minister if it is not possible, with respect to any part of this $20,000,000, to follow the law as regards the inviting of tenders for the work to be done under that expenditure?


Charles Colquhoun Ballantyne: In answer to the leader of the Opposition I might frankly state that all contracts have been placed subject to Parliament voting this amount of money. The urgency existed to keep our returned soldiers employed, and the Government are anxious to get the ships just as quickly as they possibly can; so all the contracts have been placed. I mentioned the figures involved the other night and perhaps I had better state them again. The total payments up to April, 1919, amounted to $19,510,322.35. The total payments from April, 1919, to March 1, 1920,

amounted to $24,194,639.78. The total payments on account of the Government's (Shipbuilding programme amount to $43,704,962.13. The balance available on March 1 from the vote for the current year amounts to $15,505,361.22. In addition to this balance that is available, the Government are now asking for another vote of $20,000,000, part of which is a re-vote from last year.


William Lyon Mackenzie King: I have noticed a reference that my hon. friend has made to the conditions under which these contracts have been awarded, that they are subject to Parliament voting the amount. That is what we are doing at the present moment. What I would like to ask the minister, while we are voting this amount, is, can we not in some way incorporate the condition that the amount shall be voted and expended in accordance with the provisions of the law of the land? Let me read from the statutes of 1906, part 2, chapter 39, the section which governs this matter:
"Whenever any works are to be executed under the direction of any department oi the Government, the minister having charge of such department shall invite tenders by public advertisement for the execution of such works, except in cases:
(a)	of pressing emergency in which delay would be injurious to the public interest; or,
(b)	in which from the nature of the work it can be more expeditiously and economically executed by the officers and servants of the department; or
(c)	where the estimated cost of the work is less than five thousand dollars and it appears to the minister, in view of the nature of the work, that it is not advisable to invite tenders.
Now the amount in this case is not less than $5,000, it is $20,000,000. That being so, I am asking the minister: Is it not possible-if not in regard to the whole of the $20,000,000, at least in regard to some part of it-to invite tenders in accordance with the provisions of the statute which I have quoted?


Charles Colquhoun Ballantyne: I can only answer to the leader of the Opposition that these contracts were placed quite some months ago, with the exception of one or two on the Pacific coast which latter that we were holding up because the department ovei which I preside and the ship-builders otit there could not agree on the cost of changing from coal-burning to oil-burning. Aside from that, however, the contracts were placed some months ago, and there are no further contracts now to be awarded.


Jean-Joseph Denis: Are we to understand that the contracts were awarded before the money was voted by Parliament?


Charles Colquhoun Ballantyne: The hon. member
probably heard my statement a few moments' ago that there was still a balance available on Marcti 1 of $15,505,361.22, which has not yet been expended. In addition to that we are now asking for a vote of $20,000,000, part of which is a re-vote from last year. The hon. member will therefore see that the money has not, as yet, been expended.


John Howard Sinclair: How many contracts have been awarded since the Armistice and what is the total amount involved?


Charles Colquhoun Ballantyne: Eighteen contracts
have been let since the Armistice was signed. If any hon. member wishes to refer to these contracts or any of the correspondence, I will be very glad to Table the documents. There is nothing that I wish to hide, or the Government either.


John Howard Sinclair: 
Charles Colquhoun Ballantyne: Might I ask the hon. member a question? Do I understand him to say that to-day in England, Ireland or Scotland ships of the same type as the Government has built can be bought at $105 per ton?


John Howard Sinclair: I understand that the British Government is selling ships at the present time at less than $100 a ton.


Charles Colquhoun Ballantyne: That is not an answer to my question. Did I understand my hon. friend to say that ships of a type similar to those that are being built in our Canadian yards can be built in any yards of the United Kingdom at $105 a ton or at any lower price than what the Canadian Government is paying?


John Howard Sinclair: My hon. friend has got that competition before him; all the ships on the sea are competing for that one cargo. And my hon. friend has told the House over and over again that he is charging the market rate. Now, I want to know what benefit it is to the farmer of Canada if his wheat or his cattle is carried to the Liverpool market at exactly the same rate in a Gavernment ship as in a private ship? And what can be the benefit to the taxpayer if he has to pay the deficit that my hon. friend is bound to have to make good when he enters into competition with those ships that were built at a lower price? It is a very simple calculation. I have stated that a large number of ships with which my hon. friend is competing are ships that were built before the war at a price of from $50 to $60 a ton. Great Britain, at the time the war broke out, had some twenty million tons of shipping on the seas, and a large part of that tonnage was built at those low rates.
Very many of those ships are still on the seas, and my hon. friend when the times get hard-and they are getting harder now for shipping owners, ships are idle to-day in the harbours of New York and Boston because they cannot find business-will have to meet close competition. Let us make a comparison between the conditions pertaining to the building of a ship, say, at Halifax and those prevailing in connection with the building of a similar ship in the Old Country. My hon. friend, I understand, is having two ships built at Halifax at the rate of $195 a ton. At this rate, One 10,000 ton ship will cost him $1,950,000. The insurance on that ship cannot be less than three per cent of the value of the hull; the cost of insurance, therefore, when he starts the ship in business will be $58,500. He must allow five per cent for depreciation if he expects to continue in the business and get his capital back; that will be $97,500. He tells us that he is making five per cent interest on his money; that is another $97,500. The total amount of fixed charges, therefore, on the ship is $253,500. Now, let us take a ship built on the Clyde prior to the war at $60 a ton- a 10,000 ton ship of exactly the same type, with which my hon. friend has to compete. The cost of the ship in the first place would be $600,000. The insurance on the hull at three per cent would be $18,000; depreciation at five per cent, $30,000; interest at five per cent, $30,000; in all $78,000. These two ships are competing for the same business; one has a fixed charge of $253,500; the other a fixed charge of $78,000, to that the 
handicap against my hon. friend's ship to begin with is $175,000. That is to say, he has to earn with his ship $175,000 more than the other man earns before he can begin to pay a profit. When times are hard and freights are low, it will be impossible for him to do that, and the business must end up with a very heavy loss to me people of this country.
I drew the attention of the Minister of Railways (Mr. J. D. Reid) this evening to the fact that he had not given a bookkeeping statement with regard to this business of running the railways. I want to make the same remark to the Minister of Marine. He has not given a statement-


Charles Colquhoun Ballantyne: It is here.


John Howard Sinclair: You can read his speech very carefully without finding any statement showing assets and liabilities. My hon. friend is a business man; he knows what I want. If he was giving the financial statement of a joint stock company in Montreal of which he was director or president, he would show all his assets and all his liabilities; he would show also his profit and loss account; and he would place it in such shape that a business man could take up that piece of paper and see whether the shareholders were making or losing money. He has not given us any such statement. He told the committee the other night that he had somewhere a million and a half dollars in cash and in Victory bonds. Well, I quite believe he has, but in the other pocket he may have bills amounting to a million and a half that are not paid. I do not know what his liabilities are; nobody knows; nobody can tell from the statement that he has given. If we are going into the business of running ships; if we are going into the business of running railways, we must be business men and treat the people of this country as the president of a company treats his shareholders,-that is, give them a fair statement showing just how we stand. Does any one in this country know whether or not my hon. friend is making money in this business? I am quite willing to take his word for it, but he would not need to make a speech to convince me if he gave a proper statement from which I could see for myself. I was unfortunately absent when he made his speech the other day, but I read it over very carefully and it looked to me as if he was making an apology for what he was doing. I have a suspicion that he himself has not very much faith in this scheme and that he already sees the end

of it. He does not say that he is going to continue it.
The Minister of Railways came to the rescue of my hon. friend the other night by saying that we must have ships in order to carry on the business of the country; we must have them in order to compete with the Canadian Pacific. The Canadian Pacific, he argued, has ships; therefore the Government of Canada, if it is to prosecute the business of running a railway, must also have ships to carry the traffic from Canadian ports and route it through to its destination. Now, that might be true if the Government were establishing a line of ships on the Atlantic to carry passengers and freight across to Liverpool or other ports. That would be business. But that is not what the Government are doing; they are sending their ships all over the world. And I challenge my hon. friend to show where he is going to get his return cargo. Suppose he sends a ship from St. John down to the river Plate with a load of lumber. When he gets there, there is no return cargo to bring to Canada. What will he do? Will he buy coal at an enormous rate at the river Plate, where it costs three or four times as much as it costs up here, and will he fill his ship with that coal and steam all the way back to St. John with nothing in the hold? He will not do it if he is a business man; so that if he Is going to continue the operation of his tramp vessel he must send it somewhere else. Well, the chances are that he will find a cargo of cattle or of wheat for Liverpool; nothing else will pay him. What will *he be doing then? He will be developing the trade of the Argentine and competing in the Liverpool market with the Canadian farmer. That is the kind of liner he is going to run; he cannot avoid it if he continues to do business as he is doing it now. He is not bulding liners; he is not establishing any line of ships. The Minister of Railways need not worry over making terms with outside steamships to carry his traffic across the Atlantic. Dozens of steamships which cross the Atlantic from Montreal, Halifax, St. John and various points in Canada will be glad to connect up with the Canadian National railways and carry their traffic to the other side on easy terms. My hon. friend would have no trouble in making a good bargain, because there are many of these ships and they would all be competing for the business. It is idle to say that you cannot carry on a railway business without having ships to carry your produce across the ocean. Very few railway companies in 57
the world have their own ships. England and Scotland send out as much produce as any other country in the world, but the railway companies of these countries do not, as a rule have their own ships. Very few of the United States railway companies have ships; it is very easy for them to make arrangements for the routing of their traffic through to destination. That argument, therefore, does not hold, though it was the chief argument advanced by the Minister of Railways the other night in defence of my hon. friend's policy.
I do not wish the Minister of Marine to think that I am opposed to Canadian shipbuilding, for I am not. No man is more anxious than I am to see the Canadian flag on the Seven Seas, and anything that can be done in that direction I shall support. But my hon. friend will never see that until he reduces his tariff. No protective country has ever been able to build up a great mercantile marine. For many years past no country would have been better able to do it than the United States. But it was a reproach to the United 'States, and they felt the reproach, that their passengers and their freight were carried in British ships across the ocean; that only some 12 per cent of their trade was carried in their own ships. It was a reproach to the people of the United States, and they would have overcome it if they could, but they could not overcome it and at the same time maintain their high tariff. Similarly, rwe cannot build up a mercantile marine and at the same time maintain our high tariff. If hon. members will look at the tariff schedules, they will find scores of articles that enter into the construction of ships that -are made more expensive by the tariff. The only other way of assisting the shipbuilding industry rwill be by a bounty, and personally, I am not in favour of a bounty; I think the only effective step is a reduction in the tariff if the minister expects the Canadian people to continue in the shipbuilding industry. We have a good example in the province from which I come. Many years ago, Nova Scotia was one of the greatest shipbuilding countries in the world, for its population. That is a big statement to make, but I make it advisedly. Fifty years ago, more or less, no other country in the world had as many tons of shipping on the sea as Nova Scotia had in proportion to its population; it had a ton of shipping for every inhabitant, for every man, woman and child in the province, and that figure has not, I believe, been reached by any other country. Great Britain has



a very large fleet of ships, as hon. members know; the minister told us that when war broke out she had over twenty million tons of shipping; but Great Britain at that time had a population of over 40,000,000 people, and she was the only country that could compete with Nova Scotia in tonnage. Nevertheless, in proportion to population, Nova Scotia had double the tonnage that Great Britain had. How did we get that large tonnage? We got it under what was practically a free trade policy. We had a 10 to 12 per cent tariff in Nova Scotia at that date. The ships were wooden ships. They were built from the wood of Nova Scotia; work was done by the people of Nova Scotia, the hulls were built of wood and also the fastenings, and when a hull was finished some merchant in Glasgow or Liverpool advanced the builder the rigging, sails and other material, and that was admitted into the province free. That was practically free trade, and that was the way in which Nova Scotia made such great progress in wooden shipbuilding. I quite understand hon. members will say that when iron replaced wood we could not carry on the industry; but I can assure my hon. friend that we did carry it on under a low tariff, and we carried it on successfully. I may also make the statement to him that no country in the history of the world that maintained a high tariff ever had a great mercantile fleet. Therefore, to my mind, there is just one solution and only one. I am distinctly opposed to Government ownership. It is not the part of this Government to play the game; the Government should referee the game and let the people play it. Let my hon. friend produce some kind of a policy by which the people of this country can embark in the shipbuilding industry and he will have my hearty support.


Mr. M. CLARK:: Before the minister concludes, I should like to. be permitted to say a few words on this vote. I think the House *and the country are indebted to the leader of the Opposition (Mr. Mackenzie King) for having held the vote over. We are getting a little more daylight on this question than we did the last time it was debated in this House.


An hon. MEMBER:: Louder. .


Michael Clark: Does my hon. friend mean that? It may be his hearing and not my voice that is wrong., I am, however, very glad to accommodate him. The hon. member for Guysborough (Mr. J. H. Sinclair) has just delivered a speech of very

great political wisdom and importance, and I am personally gratified to have support from him for views which I modestly put before the House last week when this subject was under discussion. His voice on this question is a weighty voice, because noother hon. gentleman in this House knows about the shipping question better than the hon. .member for Guysborough. I can only hope his reward will be better than mine-was for having given sound views on political economy. When I tried to preach the same doctrines, my genial and eccentric .friend the hon. member for Cape Breton South (Mr. Butts) was put on his feet to ask me if I ever heard of Christopher Columbus. I am glad to see my hon. friend in his place and to relieve his anxiety about my historical knowledge; I have heard of the gentleman, but I have not quite the opinion that my hon. friend appears to have of him as a discoverer. I came to America much later than Christopher Columbus, and I found things here that Christopher Columbus never dreamed of-my hon. friend, for example.
I find nothing that reflects on myself in the first part of the speech of the hon. member for Guysborough. He uses stronger language than I care to use-I am well known to be a man of moderate views and studiously and carefully guarded language. Therefore, .when the minister came with his shipping projects before the House about twelve months ago, I expressed fear that he had entered into what was an unprofitable contract. The hon. member for Guysborough changes the words slightly, and he boldly charges my hon. friend with a profiteering contract. II judge my meaning was the same, but I always like to be careful in the use of language. With regard to that, I must repeat that I think these contracts have not been profitable. I must say, when I raised this question first, I did not get the support'll expected from the official Opposition of the day. The occasion was a somewhat famous one, and my hon. friend, the then leader of the Opposition (Mr. McKenzie) made it the occasion of a declaration, which I believe was a very serious declaration for himself. On that occasion he stated, with that honesty and courage which are characteristic of him, that he was a protectionist, and I am afraid that that declaration cost him the leadership of the party. I always hate to see any hon. gentleman suffer for his honesty. Sitting where he does, it is all right for one to entertain protectionist

views, but it is very wrong to avow them. But my advice will be of no use to my hon. friend now. 1 say that I did not get the support 1 expected on that occasion from the official Opposition. I am all the more glad to see my old and honoured friend, the member for Guysborough, strike out from the shoulder in the way he did to-night. I am deeply grateful to him for enforcing my views on political economy as I expressed them last week.
II did not rise to delay this vote, but I understand that we have the assurance of the minister that this is to carry out contracts which have already been entered into, and that after that he and the Government are retiring from the shipbuilding business. I understand that is the position at which we have arrived on this question. If I am not right, no doubt the minister will put me right when he rises to reply presently.
While I am on my feet, I wish to make reference to another matter which arose in this debate last week, and I do so for the purpose of making the position of this party in this House and in the country very clear upon	a subject which,	I understood	from the minister, the Government have under their consideration, and that is the subject of possible subsidies to ships. I understand that the minister will finish these contracts and go out of what, according to. my hon. friend from Guysborough, has been a profiteering business. I do not know that we should be surprised that it is such a business. My hon. friend the Minister of Marine comes from Montreal, and his deputy comes from Nova Scotia. Well, coming from the West as 1 do, I, a priori, have arrived at the conclusion that this is not a very good combination with regard to shipbuilding for the rest of Canada,-my hon. friend from Guysborough is an exception, of course, to certain -tendencies in Nova Scotia, he still retains the free trade instincts of his family, but I am afraid there are very strong protectionists among the Liberals of Nova Scotia besides my hon. friend the late leader of the Opposition.. However, the profiteering business is to be stopped, and the Government are considering the question pi subsidies. Now I do not know whether my hon. friend from South Cape Breton was speaking in favour of subsidies or not; I am not at all sure that he knew himself. He said some things, nevertheless. He is always interesting to listen to, and thoroughly good-natured as a rule. I do not know that he was so very good-natured when he dis-57i
avowed his Irishism and proclaimed himsell a Canadian. I presume he meant by birth. I think I knew the meaning of his strong expression as well as of the enthusiastic cheers which accompanied that avowal of his nationality. All I have got to say upon that is this, that in opposing subsidies to British companies if they are going to make profiteering contracts or plunder the taxpayers of -Canada I am a better Canadian and am less of an Englishman than my hon. friend if he supports the subsidies. It is only a poor type of Canadian in this House who does not feel it his duty to look after the cash of the people whom he is sent here to represent, rather than to allow those people to be rooked by companies, let those companies be from England or wherever you like.
I did not last week get the unanimous support I should have liked from the Opposition on the question of subsidies. Indeed, the two official sides have a very strong resemblance to one another on all these questions. There are hon. members opposite who come from the farming districts of Ontario who have very little use for' subsidies, just'as there are in the official Opposition hon. -gentlemen who come from agricultural areas, who have very little use for subsidies. On the otherhand,justasmy hon. friend from Toronto spoke strongly in favour of subsidies, so my hon. friend from Lunenburg (Mr. Duff) seemed rather in a receptive mood, and he said, that if such things were going round and there was money to provide them, he would be there with his hand out-so I understood him. I Ho not know that my hon. friend from Three Rivers (Mr. Bureau) if he were present, would deny that he himself would look for a subsidy for shipping if such things were going. The hon. member for Cape Breton too I think would have an appetite in that direction. So we -see, Mr. Chairman, that in regard to the two official sides of this House there is not very much difference between the two parties, any .more than there was a year ago, in regard to this profiteering contract, between the then leader of the Opposition and the Minister of Marine.
But I want to say that there is a party in this House, which is much larger in the country, and behind which there is a swelling tide, which is absolutely at one both-on profiteering contracts and on subsidies. We here, to a man, are opposed to subsidies and .bounties on principle. We say they are unjust, they are bad political economy, they are wrong, and we oppose them, we care not what riding wants them. We are looking after the interests, the broad;

interests of the whole Canadian people. When you pay a bounty to Dominion Steel,
* or a subsidy to shipbuilders, to placate the electors of a certain constituency, where do ; you get the money? Some one addressed [DOT] that question to the minister the other day, sand in the innocence of his heart he said. "I think we will get it from the bank." When you get money from a bank, the bank is not acting like the Good Samaritan-the money has to be paid back. Where does the money come from for all these doles? It comes from the brawn and sinew of the labourer, from the twelve hours' day of the farmer, from the worker in the factories. It comes out of the blood and bone and muscle of the people. We say it is a wrong thing to spend in bounties and subsidies money that has been got in that way. So we are opposed to subsidies on principle, and we are so opposed to a man.
I want to make one more point in this connection before I sit down. We are especially opposed to subsidies at this time because of the financial conditions of the country. I am trying to give the Government some grounds on which to come to a wise decision on policy, which we have been told by the minister is to be communicated to us when the financial statement for the year is brought down. The Government lias no money to throw away in subsidies at the present time. The Government are living on borrowed money. They have just taken $700,000,000 from the people of this country, and the Lord only knows in His dwelling place when they will be able to pay it back unless we change our fiscal policy. They have neither moral right nor ' financial status to give subsidies of this hind. What the people of this country -want is honest housekeeping. They want their money taken care of, and it is only by taking care of it and by arranging taxation on a proper basis that we shall alter the exchange against us in the United States, reduce the cost of living, and make Canada a fit country for heroes to dwell in.
. I have one more ground supplied to me by my kind and genial friend from South Cape Breton. He told us in his address last week that they got the cheapest ore 'from Newfoundland that is to be found on the face of the earth. I do not think I misrepresent my hon. friend-the cheapest iron ore in the world.
, Mr. BUTTS: What I did say was that we were capable of producing on the shores of Sydney harbour the cheapest pig iron in the world.


Michael Clark: From the splendid
ores of Newfoundland they are capable of producing on the shores of Sydney harbour the cheapest pig iron in the world. Capable? Then capable men do not want subsidies. That is the argument. If you have the cheapest ore, and you are capable men, then take the advice of my hon. friend from Guysborough: Go to it and build ships in competition with the world.
i Mr. BUTTS: I might tell my hon. friend from Red Deer, as he comes from a farming country, that we do not build ships out of pig iron.


Michael Clark: I might tell my hon.
friend, though I come from a farming country, that he cannot build them without .pig iron. Does my hon. friend wish another exchange? Mr. Chairman, I am a Canadian, and I wish to induce Canadian-ism, but not of the puny kind that comes to this House seeking subsidies. I want to produce Canadians who can stand four square to all the winds that blow, as their forefathers did in the Islands of the North sea, and as their brothers did in the trenches in Flanders. I -want Canadians who in the trade and manufacturing world can stand four square to all the winds that blow, and say to competition, let it come from where it will: We are capable men; we have the material and we can produce the goods. That is the kind of Canadian-ism I believe in.


Charles Colquhoun Ballantyne: I am greatly surprised that the member for Guysborough (Mr. Sinclair) and the member for Red Deer (Mr. Clark) should charge this Government in face of the information I have placed before the House, with having placed profiteering contracts. I take issue squarely with both hon. gentlemen and aver emphatically that not one profiteering contract has been placed. It is all very fine for hon. members, possibly for political reasons, to level such a serious charge against me as a responsible minister, and against the Government. But before this House and the public of Canada will accept the allegation that profiteering contracts have been placed by this Government, these hon. gentlemen must adduce more substantial proof than merely making the charge , and letting it go at that. The hon. member for Guysborough did me the hpnour to confess that he had carefully read every word of my speech, and then alleged that profiteering contracts had been placed, stating that ships could be built in the United Kingdom at lower prices than those at which the Can-

adian Government had placed their contracts. I am sorry to take up the time of the House, but in view of the first charge of dishonesty that has ever been levelled at this Government or any member of the Government, I wish to quote again the figures I quoted the other day.


Michael Clark: I rise to a point of order. Nothing I stated could be construed into a charge of dishonesty against the minister. When I talked of unprofitable contracts I meant the profits which the Government should have saved for the country went to those who sold steel plates at a dearer rate than that at which they should have been sold. That is not a charge of dishonesty against the minister. I had no such thought in my mind, and no word of my language will bear that interpretation.


Joseph Philippe Baby Casgrain: It is bad business.


Charles Colquhoun Ballantyne: I am glad to hear
the statement of the hon. member for Red Deer. I certainly understood him to say that profiteering contracts had been placed for ships, but if I am wrong I accept with very good grace the hon. gentleman's assurance that he did not intend to convey the impression that profiteering contracts had been placed by this Government.


Michael Clark: My hon. friend
must not misunderstand me. I endorse the position taken by the hon. member for Guysborough, but a distinction must be made between profiteering by contractors with whom the minister does business, and profiteering by the minister himself, which would be the only thing that could justify a charge of dishonesty.


John Howard Sinclair: 
Mr. JACOBS:: During the war?
Mr. BALLANTYNE':	During the war.
Most of our contracts had been placed during the war, and since the Armistice was signed the Canadian Government ordered ships at $167.50 per ton; and I say from my place in this House that for a similar type of ship placed at the same time no one could have obtained in England, Ireland or Scotland a lower rate than $167.50.


Mr. MURPHY:: Has the minister any
figures to substantiate that statement?


Charles Colquhoun Ballantyne: Certainly. The
figures I quoted just now are the official figures of the Committee on National Expenditure of the British Government. That is my authority.


Charles Murphy: Were these contracts
placed during the war?


Charles Colquhoun Ballantyne: I presume the orders for these ships were placed during the war.


Charles Murphy: If the hon. gentleman will permit me. Earlier in the evening he mentioned that contracts for eighteen of these ships had been awarded since the signing of the armistice. Has the hon. gentleman any figures to show the price per ton of other ships, the contracts for which were given about the same time?


Charles Colquhoun Ballantyne: 
Some hon. MEMBERS:: No, no.


Andrew Ross McMaster: What was the rate of exchange?


Mr. DUFF :: At what date?


Charles Colquhoun Ballantyne: May of last year.


Charles Murphy: Can the hon. gentleman tell the committee the price per ton in the case of any contract for ships placed by well known private corporations, for instance such as the Canadian Pacific Railway, about the same time as he placed these orders for ships?


Charles Colquhoun Ballantyne: I will not give the name of the firm that ordered the ships because I do not think I would be right in doing so. I can say this, however, that Norway has placed orders for ships with one of our yards in this country within the last three months, at $170 per ton, and France has also placed an order at $170 per ton. I can say further that the Canadian Government have been offered not only the price that we are paying for our ships but more if we choose to sell them.


Charles Murphy: Then the hon. gentleman has no figures with respect to orders given by Canadian firms upon which to base a comparison?


Charles Colquhoun Ballantyne: No, 1 do not know anything about the orders given by any Canadian firm, but the very fact of Norway and France placing orders in Canada within the last three months at prices higher than the Canadian Government are paying, is, I think, conclusive evidence that ours are not profiteering contracts.


Charles Gavan Power: Is the $167 per ton the lowest price, or the average price, of the 18 ships referred to?


Charles Colquhoun Ballantyne: The lowest price.


Charles Gavan Power: What was the highest price?


Charles Colquhoun Ballantyne: For what period?


Charles Gavan Power: I would like to know the highest price at which contracts were let for any of the 18 ships since the signing of the armistice.


Charles Colquhoun Ballantyne: Shortly after the signing of the armistice a contract was placed at $170 per ton and that is the highest price that has been paid for that type of ship-that is the largest type, of 8,400 tons deadweight. Most of these orders were placed at $167.50 per ton. I also stated last week that the firm of Skinner and Eddie, of Seattle, are constructing standard vessels of 8,800 tons. Mr. Skinner, when giving testimony before the United States Senate last month, declared that these vessels were being constructed at the present time at a price of $185 per ton. Now, I think, Sir, that I have proved my case, that no profiteering contracts have been let. I have also proved that the United States, their programme being much larger than ours, have paid $25 per ton and upwards more than we have paid. I have shown the price that the Imperial Munitions Board have paid for steel ships, and for wooden ships, and I have shown the price that Great Britain has paid for steel ships during the war. I have stared what the price is to-day for similar ships built in the United Kingdom and built here. 1 have given all these figures, which are absolutely accurate and official, and neither the Canadian Government nor this Parliament should be ashamed of the prices at which we have placed our contracts. Ie: me repeat again, there is no justification for the charge that has been made as to placing profiteering contracts.
The hon. member for Guysborough (Mr. [DOT]Sinclair) stated that he has some doubts as to the net profit of $1,406,000 that I stated a week ago resulted from the operation of the 19 ships that were in commission last year, some of which had only made one trip. The hon. gentleman states that as a business man, before making such a statement to the House, I should be prepared to lay before it the usual business statement showing assets and liabilities. I am glad to tell the hon. gentleman that I have

that very statement here, assets are as follows:	The current	
Cash in banks	$432,576	13Victory bonds	504,583	33Accounts receivable . . . .	492,247	75Outstanding freight . . ..	71,411	05Material and supplies . . .	1,668	87Total	$1,502,487 13
The total assets of the company are $2,024,537.40. The liabilities are as follows:
Accounts payable	$627,701 52
Open voyages account . ..	340,068 50
The profit account is $1,056,767.38, and the total net profit, as I stated before, $1,406,000. If the hon. member for Guys-borough doubts' that statement, I would like, with the unanimous consent of the committee, to place on Hansard a statement of the gross and net profit of each one of these ships for each voyage.


William Duff: Hear, hear.


Charles Colquhoun Ballantyne: These profits, as I
have already stated, were .arrived at in the .same way that any business house would arrive at profits. After providing for organization, overhead expenses, depreciation, interest on the ships and insurance, the net profit has been arrived at, the amount being as stated.
The hon. gentleman (Mr. J. H. Sinclair) takes a more gloomy and pessimistic view of the Government ownership of ships than I do. I am a thorough believer in the Government ownership and operation of ships. Where would Canada have been during the past year if it had not been for the Government ships that brought a vast amount of tonnage of raw sugar from the West Indies to the sugar refineries of Canada at Halifax, St. John and Montreal? There would have been an actual sugar shortage in this country. Where would the people of British Columbia have been with respect to the large amount of lumber that they had in that province if it had not been for the Government ships which carried that lumber to England, to Australia and to New Zealand?
It has been stated by the hon. gentleman that ships operated by private ownership are going empty either one way or the other. I am happy to tell the hon. gentleman that the Government ships have full cargoes both going and coming on the various routes on which they are operating. I do not wish to unnecessarily occupy the time of the House, but let me cite the case of the Canadian Pioneer that runs to Buenos Ayres. The gross earnings of that vessel on the outward voyage were
$174,961.17. On the return voyage the gross earnings were $292,000.


William Duff: What cargo did she bring back?	'


Charles Colquhoun Ballantyne: Hides and other goods. I cannot give you the precise details of the composition of her cargo.


William Duff: Did she bring that cargo to Canada?


Charles Colquhoun Ballantyne: Some of it here and some of it to New York. But that does not make any difference. What I am trying to refute is the statement of the hon. member for Guysborough (Mr. Sinclair) to the effect that these vessels did not have return cargoes.


William Duff: He did not say that. He said they did not bring return cargoes to Canada.


Charles Colquhoun Ballantyne: Most of these ships did bring return cargoes to Canada, but part of this particular ship's cargo was destined for the port of New York.


William Duff: What did she bring to Canada?


Charles Colquhoun Ballantyne: If the hon. member will wait until I get through I will be glad to give him any information he wants. The total gross earnings of the " Canadian Pioneer " for that one voyage from Montreal to Buenos Aires were $466,961.17, and the net earnings were $214,828.27. As I stated, I have in my hand the gross earnings and the net earnings for the open voyages and for the closed voyages, and I will be very glad to hand it to the hon. member for Guysborough, or if the House prefers I will place the statement on the pages of Hansard.


William Duff: Has the minister got a statement there of the steamer " McKee "?


Charles Colquhoun Ballantyne: That is not a ship that was built under the Government's shipbuilding programme, she was bought several years ago and operated by the Railway Department. I have none of these old ships in my statement, only the new ships that have been built and operated under the Government's shipbuilding programme.


John Howard Sinclair: Was she not bought with money voted by this Government for the purchase of ships two or three years ago?


Charles Colquhoun Ballantyne: I can only say that such purchase has not been out of any

votes that have been put through the House for the Government shipbuilding programme since I have had the honour of being Minister of Marine. Before I resume my seat I want to say that with our large transcontinental railway system of 22,000 miles this House would be ill-advised, in my humble opinion, if it did not endorse the Government ownership and operation of these ships in order to compete with the Canadian Pacific railway. Not only do these ships make the profit that I have stated, but co-operating with them our railway system makes a profit also on the long fiaul.


Some hon. MEMBERS:: Oh, oh.


Charles Colquhoun Ballantyne: I will put it in another way that probably will better please hon. members opposite. I want to say that the .deficits on railway operation would have been even greater than what the hon. Minister of Railways has stated to-day did w'e not have these ships working in cooperation with our railway system.


William Duff: Absolutely not.


Charles Colquhoun Ballantyne: Well, I differ from my hon. friend there. 1 am quite willing to adopt the policy of the Canadian Pacific Railway. There is no better managed corporation than the Canadian Pacific Railway Company, and if the Canadian Pacific Railway Company have seen fit to operate a large fleet of cargo and passenger ships in conjunction with their railway system, and to keep their marine accounts separate from their railway accounts in order to be able to tell what profit each branch is making, the Government of Canada cannot be wrong in following that policy. It has come to my notice since I have been minister, and I knew it before, that all transatlantic steamers are controlled by pooled rates. As a result Canada has been discriminated against time and again. How can we expand our export trade to South Africa, the West Indies and to other countries unless we own our own ships? Even if Canada did not make a cent on her ships, -I will go further than that and say, even if she made a loss,-the Government would be fully justified in carrying out their programme of owning and operating these ships. From what I have seen of the advantages of these ships in extending Canada's export trade, and also of the benefit accruing to our railway system from their operation, I am convinced that when the days of keener competition come, if those engaged in farming, mining, lumbering and manufacturing,
[Mr. Ballantyne.l
either directly or as middlemen, find they cannot compete with other countries on account of our freight rates being a little high, I for one would think the Canadian Government Merchant Marine would be fully justified in lowering those rates in order that the products of our farms, mines, forests and factories could be delivered in any foreign countries on a basis that would [DOT]enable our exporters to compete with the rest of the world. Therefore I will say as I take my seat that not only do I believe enthusiastically in the Government shipbuilding programme, but, without wishing to assume the role of a prophet, I also believe that if we are spared to meet here a year hence we shall be able to show a very much larger profit statement than the one I have already submitted to the House.


John Howard Sinclair: I differ from my hon. friend in his statement that we cannot build up an export trade without owning a merchant marine. He has made that statement constantly, and, in my judgment, it is without foundation. It is low freight rates that give a country a chance to build up an export trade, and you do not get low freight rates under government manage-merit. At the time the ships came under government management in Great Britain, the freight rates went up something like 58 per cent, and in some cases as high as 85 per cent, and when the same ships went back into private ownership the freight rates dropped again. That is what happened in England. Low rates will give you a chance to export; high rates will cripple you. Surely the Government of Great Britain is just as anxious to build up export trade as is the Government of Canada at the present moment, yet what is the Government of Great Britain doing? It is selling every ton of shipping it owns and putting the ships back into private hands, and it is selling them at a price a little more than one-half of what my hon. friend is paying now for the ships he is building to compete with those very ships for the export' trade. The Government of the United States is just as anxious to build up an export trade as my hon. friend can be, but what is that Government doing? It is making arrangements to transfer all the ships it holds into private hands, and the price is mentioned at about $100 a ton. When my hon. friend says that export trade cannot be built up by a country without the Government owning the merchant marine, I want to tell him that it has been done. No country in the world has built up such an export trade as Great Britain, it has beaten

the world in exports, and imports as well, and while doing that it did not own one ton of shipping. My hon. friend will have to revise his information on that question before he is very much older.


Michael Clark: Mr. Chairman, I just want to confirm in two words what my hon. friend (Mr. Sinclair) has said about Great Britain. I daresay many hon. members read'the very informing article in last nights' papers from an American correspondent in London pointing out that Great Britain since it parted with its government ships and sent them hack to private ownership has exported more goods in the month of February just past than it had exported in any given month since the beginning of the war, that is, since the year 1914, and that those exports were going up every day. That is the condition of affairs under private ownership in Great Britain, which country, after all, does know something about shipping and cuts quite a figure in the shipping world.
But my main purpose in rising was to deal with a much more important statement of my hon. friend. A week ago he stated that the money we are voting now was to end existing contracts, and that on their completion the Government was going out of the business.


Charles Colquhoun Ballantyne: That is right.


Michael Clark: Then I need say no more. I hope my hon. friend does not misunderstand me.


Charles Colquhoun Ballantyne: If the hon. member will allow me, I made the statement before, and I make.it now, that the Government has finished its shipbuilding programme. I presume that is what my hon. friend refers to.


Michael Clark: I am very glad to hear that assurance; it simplifies the proceeding of getting this vote through so far as I am concerned. But in his speech to-night I certainly understood my hon. friend to express a very enthusiastic opinion in the direction of the Government's continuing this business, and I thought that statement not consistent with the interpretation, which it appears was correct, which I had put upon his statement when this matter Was previously before us.


William Duff: I understood the minister
to say last week that as the result of the operation of these nineteen steamers he had #1,500,000 cash in bank and Victory bonds. He told us also that there was a net profit
of $1,400,000. To-night he tells us that he has only #432,000 in the bank and $504,000 ,in Victory bonds, a total of $936,000. There is a discrepancy which I should like the minister to explain.
[ Mr. BALLANTYNE: Accounts receivable are also considered as cash; these amount to $492,247.75. Outstanding freight is also included.
i Mr. DUFF: I admit that I am not much nf a business man, but I never heard tell of accounts receivable being put in the bank as cash. If that is the way the Minister of Marine does business, the quicker he sells his ships the better. Accounts receivable are not cash, therefore the Minister of Marine deliberately misled this committee when he told us that he had $1,,500,000 by way of cash in the bank and Victory bonds.


Georges Henri Boivin: I must ask the hon. member to withdraw the words " deliberately misled."


William Duff: Well, unintentionally misled the committee. There is no question that there is not $1,500,000 in the bank. The minister also told us that there were liabilities of $627,000 and outstanding accounts payable amounting to $340,000, a total of $967,000. According to these figures, instead of having $1,400,000 to his credit, the minister has only $500,000. Then, he does not allow for depreciation. If he can offer an explanation of that I shall be glad to hear it.
, Mr. BALLANTYNE: I have said on more than one occasion that the net profits were arrived at after providing for operating expenses, overhead, depreciation, interest on cost of ships, and insurance. If the hon. member wishes me to read the figures again I will do so, but they are as I gave them a moment ago.


William Duff: I would like to have the
thing explained so that the committee will understand it.


Charles Colquhoun Ballantyne: Very well. The current assets of the company are as follows: Cash in banks, $432,576.13; Victory bonds, which are the same as cash, $504,583.33; accounts receivable-I said, not that they were cash, but that they were equal to cash-1492,247.75; outstanding freight, $71,411.05; material and supplies, $1,668.87; a total of $1,502,487.13. Equipment, $8,502.03. Deferred charges:	insurance, $505,284.27;
advance wages, etc., $8,263.97; grand total of assets, $2,024,537.40.


William Duff: 
Charles Colquhoun Ballantyne: I assume that it
would mean office furniture, and so on.


William Lyon Mackenzie King: Has the minister a list of the contracts that have been awarded since November 11, 1918, and their amounts?	.


Charles Colquhoun Ballantyne: My deputy will get the information and I will give it to iny hon. friend when it is ready.


Mr. MANION:: 
William Duff: Did the United States have a government-owned mercantile marine?


Robert James Manion: I am not discussing the
subsidies to vessels; I am referring to the suggestion which is frequently made that Great Britain has passed all other countries in the matter of foreign trade and pointing out that according to these figures, which are absolutely reliable, the United States and Germany have surpassed Great Britain in percentage of increase of foreign trade.


William Duff: Without any government
mercantile marine?


Robert James Manion: 
Andrew Ross McMaster: Referring for a moment to the interesting figures placed before the House by the hon. member for Fort William and Rainy River (Mr. Manion), 1 wish first to say that he is using the very unsound percentage comparisons . which were the fundamental unsoundness of the abortive campaign for protection which Mr. Joseph Chamberlain carried on in England some fifteen or eighteen years ago. Of course, the percentage of progress made by people who come into a race later than their competitors who have been in the race fol years, is bound to be much greater than the percentage of progress made by the latter. For instance, let us imagine that Nova Scotia had a fleet of 1,000 vessels and that Prince Edward Island had a fleet of four vessels, and that in one year the fleet of Nova Scotia increased to 1,500 vessels, which would be an increase of 50 per cent, while the Prince Edward Island fleet increased to eight vessels, or an increase of 100 per cent. According to the arguments of my hon. friend across the way, the progress of Prince Edward Island would have been twice as great as that of Nova Scotia. That is precisely the basis of his interesting figures placed before the committee.
To return to the subject matter of the debate of to-night, I am going to make a last appeal to the minister to get out of this business when he can do so with a profit. The minister is in a peculiar position tonight. He has told us, with one breath: I believe in government ownership and operation of vessels, and again in reply to a question asked by the hon. member for Red Deer (Mr. M. Clark) he has, if I mistake not, said that after these ships are built, the Government is at the end of its shipbuilding programme, and-I presume he will correct me if I am wrong-its ship-operating programme.


Charles Colquhoun Ballantyne: If the hon. member will allpw me, I did not make any statement about the operation of the ships other than that they were operated and managed by the Canadian Government Merchant Marine. The reason the Government have ceased placing contracts for freight ships is because we consider that with 63 steamships with a net tonnage of 380,000 tons, we have ample tonnage to take care of whatever export trade the ships might be called upon to carry or whatever other service they might be called upon to perform in conjunction with the government railways.


Andrew Ross McMaster: First, as to the statement that it is the Canadian Merchant Marine Limited that carries on the business, that is merely a naval uniform for the Government. The "Government will be and will remain, in the eyes of the people responsible, and I should like to know- the minister, I am sure, will tell me- whether it is the intention of the Government, once they have finished their shipbuilding programme, to go on with a ship-operating programme under the guise of this company.


Charles Colquhoun Ballantyne: Yes.


Andrew Ross McMaster: That places the matter before us fairly and squarely. I think the Government, in this policy, is making a grave error which, in the long run, will cost the taxpayers of this country large sums of money. The first reason for my belief is this:	The ships have been built at very
high prices. Before I touch on the question of price, I wish to revert for a moment to this situation, that 18 contracts which were let for the building of 18 ships, were let illegally and improperly. I want that fact to sink into the consciousness of the Canadian people. What has the minister said in defence of this irregularity? He has said:	I was very careful in letting
those contracts, and I saw to it that the price was a fair one; I drove a hard bargain with people on the other side. With all respect, I wish to tell the minister that that is no answer. It is not for the Minister of Marine, nor for anyone in charge of a Government department to say: I am above the law; the law, it is true, lays down certain rules for my guidance; but I thought that I could, for the benefit of the country, depart from those rules so laid down. That was improper conduct on the part of the minister, and I trust the people of Canada will take note of it.


Charles Colquhoun Ballantyne: Will the hon. member allow me a question? I think the hon. member heard his leader read the law?


Andrew Ross McMaster: Not only did I heal
my leader read the law, but I read the law myself to the House.


Charles Colquhoun Ballantyne: If my hon. friend
will allow me, 'when the armistice was signed, a great emergency existed in this country-


Andrew Ross McMaster: We are getting at cross purposes. I am not complaining as to the building of these ships before the armistice; I am complaining about the building ol ships after the armistice. In my opinion, no such pressing emergency existed once the armistice was signed as warranted the minister in departing from the law.
The next point I wish to make is this. The minister has said: I know that I did not let the contracts at too high a price, because during the war contracts were let at a very much higher price. That is not an answer. The minister might have said: Since the armistice has been signed, Great Britain, in her shipyards, has built on government account ships at so much per ton; the United States since the armistice has been signed, has built in her shipyards on Government account ships at so much per ton. The minister has not done that; he has, in order to justify his action, compared post-war prices which he granted after the armistice with prices which were granted while the war was on, and that is not a fail comparison. The point which I wish to make is how unsafe and unsound it. is for any. minister to depart from what I regard as the plain letter of the law.
What is the present situation? We are asked to vote money to build ships at about $195 per ton, when ships with which these ships have to compete are being built or at least are being sold-and it makes very little difference whether they are being built or sold in Great Britain and in the Untied States at roughly half that price. In an article taken from an English paper I read the other day that there are as many ships in the world to-day as there were at the outbreak of the war. Now, if that statement is correct, and I believe it is, the minister will very shortly have to compete with ships as numerous as those before the war, and a great number of these ships will be pre-war ships which were built at $55 or $60 a ton. The reason why high rates are still being earned is that many of the harbours of the world are overcrowded, and ships have therefore to wait for cargoes, and we have not the free circulation which we otherwise would have. But freights are dropping every day, the practical mariner from Lunenburg (Mr. COMMONS
Duff) assures me. I am glad the minister has made money for the Canadian, people so far, if he has made it-other experts say he has not-but, anyway, so far he has got along without a severe loss, and I am glad of it because the Canadian people need every red cent we can lay our hands on. But the point I want to make is this-I have made it before, and I do not wish to labour it-the operation of tramp steamers is not a proper function for a Government department. All we do require is the initiative and the liberty which private ownership will give.
The minister has called to his aid the Canadian Pacific. He tells us that the Canadian Pacific own ships on the sea. Yes, they own the big transatlantic and transpacific liners for the purpose of rounding out their transcontinental system. But that is not the sort of boats the minister is building or proposes to build. If he was proposing to build 14,000-ton or 15,000-ton liners there would be something in that argument, but as he is building only tramp steamers of 8,000, 6,000, 4,000 and down to 2,200 deadweight tonnage, his argument falls to the ground. We have had an example both in the United States and Great Britain of government ownership of steamers. These two great nations have seen fit to return to private ownership. Is their example worth nothing to the minister? I venture to assert that there is hardly a shipping man in Montreal who agrees with the proposal of the minister and with the policy he has adopted. .


Charles Colquhoun Ballantyne: Hear, hear. Not
one.
Mr. MeMASTER: I suppose the minister will say that is merely selfishness on their part. The minister has already said his line is subsidized, that if it does not pay for itself the deficit will be made up out of taxes. I wish to take emphatic issue with the minister there. A public service, whether it is publicly or privately owned, should pay for itself and stand on its own feet. The proposal that you should take certain activities of the Canadian people and socialize them, and then ask the whole Canadian people to make up the loss in operation is, I think, unjust. I believe it will not work. I believe experience has taught us that it has not worked in the past, and I believe it will not work in the future. We are dealing with vast sums of money in this matter. I presume that the minister will be able to get his vote through, in view of the large majority of members

of this House who sit behind him, but I wish to raise my voice in protest against a grave mistake and a deep wrong to the Canadian people, and I only hope and wish the minister will heed my words.


Charles Colquhoun Ballantyne: The hon. member
for Brome (Mr. McMaster) has pleaded eloquently and well for the agents of private steamship companies in the city of Montreal, from which city we both come, but that does not alter my opinion nor the opinion of the Government. Although my hon. friend heard the law quoted by his leader, he still says that contracts for 18 ships were illegally let. I repeat again, a great emergency existed. After the signing of the armistice we were bringing back hundreds of thousands of our returned soldiers.
Mr. MeMASTER: How many returned soldiers were brought back in Government ships?


Charles Colquhoun Ballantyne: None, but that does not alter my argument. The leader of the Opposition has cited the law, and within the confines of that law the Government ordered these eighteen ships. There was an emergency at that time. The whole country was upset. Thousands and thousands of men were out of work after the signing of the armistice. Hundreds of thousands of our brave men were returning from the front, and aside from the need for ships, which I claim the Government needed badly, a responsibility rested on the Government of providing work for the thousands of men who were out of work in this country at that time and for the large number of soldiers who were returning from day to day.


Samuel William Jacobs: How long would it have taken to call for tenders in the ordinary way, assuming there was an emergency?


Charles Colquhoun Ballantyne: I have already gone over that ground several times, and I do not think it is necessary for me to go over it again. However, I do not want to be discourteous, and I will explain in a few words. With seventeen yards calling for public tenders and six out of the seventeen quoting lower than the balance of the yards, how could we have kept the whole seventeen yards employed to relieve the unemployment situation?- I say that the Government kept within the law in placing these eighteen contracts since the armistice was signed.


William Duff: Was there an emergency in January and February of this year, when I believe some contracts were let?


Charles Colquhoun Ballantyne: Yes, I will come to that later. The hon. member for Brome apparently did not hear what I stated. He says that I only quoted pre-war prices.


Andrew Ross McMaster: I do not want the minister to take me up wrongly. I said that the minister compared the prices of vessels ordered since the armistice with the prices of vessels built during the war, not before the war.


Charles Colquhoun Ballantyne: I still state that
the hon. member for Brome could not have listened to what I stated. Let me compare the prices paid by the Canadian Government for ships since the armistice with the prices paid by other countries. I have already given this information, but I have no objection to repeating it. A well-known steamship company in .the old land that has a line of steamers running to Montreal paid, when the rate of exchange was at $4.80, the price of $216 per ton as compared with Canada's price of $167.50. France paid $170 per ton since the signing of the armistice, Norway paid $170 per. ton, and the United States paid $185 per ton.


William Duff: Will the minister inform us in what way the idle situation constituted an emergency that could justify the placing of the contracts without tenders being called for?


Charles Colquhoun Ballantyne: I am sure that the hon. member (Mr. Duff), who lives by the sea where there are not so many unemployed men as there are in other parts of the country, must be aware that the idle situation was one of the most serious problems with which the Government had to deal after the signing of the armistice. It was a matter of providing help for unemployed men, particularly returned soldiers, and under the law cited by the leader of the Opposition, a real emergency existed when such a large number of men were out of employment, apart altogether from the pressing need of getting the ships.


Charles Gavan Power: Is it not a fact that the
Government voted for out-of-work soldiers a sum of $40,000,000 of which only $4,000,000 or $5,000,000 was expended. I can hardly see where there could have been such an emergency, if among the class which might have been expected to be unemployed, we did not find it necessary to spend more than one-tenth of the amount voted for the purpose of meeting unemployment.


Charles Colquhoun Ballantyne: Does the hon. gentleman argue that there were not thousands
and thousands of men out of work in all the large cities and towns throughout Canada after the signing of the armistice?


Charles Gavan Power: I am speaking of the
months of January and February this year.


Charles Colquhoun Ballantyne: Well, does my hon. friend say that in January and February of this year there were not thousands of men out of work in all the large centres?


Some hon. MEMBERS:: No, no.


Charles Gavan Power: Apparently, from the Government returns there were not. If I remember rightly, during the month of January there were very few men out of work, at least if we accept the Government returns as given by the press. In any event, there was not sufficient unemployment to constitute such an emergency as would make it imperative that contracts should be given without tenders being called for.


Samuel William Jacobs: Can the minister give us a statement as to the number of returned men employed in these shipyards?


Charles Colquhoun Ballantyne: I cannot give the
hon. member the exact figures. There were twenty-five thousand men employed in the shipyards in Canada, and an equal number were employed in the allied trades, such as the manufacture of marine engines, boilers, winches, chains, etc. I do not know, of course, exactly what * percentage were returned soldiers, but I think I can safely say that the returned soldiers comprised a very large percentage.


Samuel William Jacobs: Is the information available?


Charles Colquhoun Ballantyne: The only way in
which we could obtain that information would be by writing to each of the shipyards.


William Lyon Mackenzie King: The minister promised to give us a list of contracts.


Charles Colquhoun Ballantyne: Yes. There were
forty-five contracts placed before the signing of the armistice, and the contracts that have been let since then are as follows: Canadian Vickers, 4; Tidewater Shipbuilders Ltd., 2; Port Arthur Shipbuilding Co., 5; Harbour Marine, Victoria, 2; Kingston, 2; Coughlan and Son, 6; Halifax Shipbuilders, 2; Nova Scotia Steel Co., 3; Prince Rupert Co., 2; British American Co., 2; Col-lingwood Shipbuilding Co., 3; Midland Shipbuilding Co., 1; Wallace Shipyards, 2; Dominion Shipbuilding Co., 2.


William Lyon Mackenzie King: These contracts were for the construction of ships. DO

they include the entire equipment and furnishings of the ships as well?


Charles Colquhoun Ballantyne: Yes.


William Lyon Mackenzie King: The whole thing is awarded in one contract; there is no separate contract for furnishings?


Charles Colquhoun Ballantyne: No. The Government lets the contract at so much per ton, and its designs and specifications have to be followed. The shipbuilding company who get the contract have to place orders for the engines, boilers, and all the equipment that goes into the ship.


William Lyon Mackenzie King: Is there any specification requiring the boilers, etc., to be purchased in Canada?


Charles Colquhoun Ballantyne: Yes.


William Lyon Mackenzie King: Are copies of the contracts available?


Charles Colquhoun Ballantyne: Certainly.


John Howard Sinclair: I understand that a ship called The Recruit was lost in the St. Lawrence. Has the minister received the insurance on that ship?


Charles Colquhoun Ballantyne: The Canadian Government Merchant Marine, who operate the ships, insured this vessel, the cargo of which was also insured. She is lying at the mouth of the Saguenay river, and will be salvaged without difficulty. For the information of the hon. member I may say that the Canadian Government Merchant Marine places the insurance on vessels and looks after all matters of that nature.


Andrew Ross McMaster: She is abandoned to the underwriters?


Charles Colquhoun Ballantyne: Yes.


William Duff: The Government is not interested in the cargo?


Charles Colquhoun Ballantyne: No.


John Howard Sinclair: Has no money been received yet on account of the insurance? In the statement which the minister has given us has he taken this wreck into account? Is it a loss, or how does it stand in the statement?


Charles Colquhoun Ballantyne: The Canadian Recruit, which was wrecked by heavy ice, does not enter into the statement I have presented to the House. I inquired of Mr. Hanna Whether the ship and cargo were fully insured* and he informed me that they were. The ship has been abandoned, to the underwriters, but whether or not they have paid any money to the Canadian

Government Merchant Marine, I cannot say.


William Duff: What interest has the Government or Mr. Hanna in the cargo of the . ship? I may be wrong, but I understood, the minister to say that the cargo was insured by the Canadian Government Merchant Marine. What interest can the Government have in the cargo?


Charles Colquhoun Ballantyne: The shippers insure the cargo.


John Howard Sinclair: A few days ago I made certain inquiries regarding a ship called the A. J. McKee, and the minister informed the House that at 31st December last there a balance against that ship of $269,254. Has that been charged against the profits of the operation of the ships during the year?


Charles Colquhoun Ballantyne: The statement I have given to the House does not include the steamship A. J. McKee, which was an old ship purchased by the Department, of Railways and Canals before this Government was elected; and the answer to which the hon. member now refers was not given by me but by the Minister of Railways (Mr. J. D. Reid).


John Howard Sinclair: That ship, while it was purchased prior to the election, was acquired for the purpose of carrying freight, and was a part of the Government's policy. The fact that the ship was purchased in April, 1917, which I understand is the date, cannot affect the result. The minister, I think, should have charged that loss against the account, and should have given us a full and fair statement as to how the account stands. It occurs to me that it is not fair for the minister to give a statement leaving out the ship which made a large loss and putting in the vessel which made a profit.


James Alexander Robb: Before the item carries I want to get some information from the minister which may be of interest to the shippers of this country. I met only to-day the representative of the largest firm of cattle shippers in Canada who told me that during the winter they were compelled to ship cattle via New York because there were no ships calling at Canadian ports that were equipped to properly store cattle for shipment across the Atlantic. I want to know from the minister if he proposes to so equip the Canadian Government vessels that they can take care of the Canadian livestock trade. Another matter upon which I want to get some information is this: He
I

made the statement that heretofore Canada hW been discriminated against in the matter of ocean transportation. It has been a complaint of the manufacturing interests of Canada that ocean freights discriminate in favour of the raw material and against the manufactured product; that is, that raw material oftentimes is carried at a cheaper rate than the equivalent of that material when manufactured. I would like to know from the minister what will be the policy of the Government in future in the matter of rates as between the manufactured product and the raw material. For instance, will wheat be carried cheaper than its equivalent number of bushels if put into flour? I think it would be only fair for the minister to make a statement on these matters at the present time.


Charles Colquhoun Ballantyne: In answer to the hon. member I beg to say that the gentleman to whom he refers in speaking of shipments of cattle called upon me to-day. I told him that I knew of no reason why the Canadian ships should not be fitted up so as to carry cattle, and no later than this morning I referred this gentleman's letter to the manager of the Canadian Government Mercantile Marine at Montreal. I hope that the manager will take steps to see that the ships are so fitted as to enable them to carry Canadian cattle. The other questions to which the hon. member referred-	*


James Alexander Robb: Before the minister gets away from that point, is the statement correct that Canadian cattle had to be shipped all the winter from New York because of the lack of shipping facilities from Canada?


Charles Colquhoun Ballantyne: I am sorry that I cannot definitely answer that question until I hear from the management of the Canadian Government Mercantile Marine. The other question the hon. member has put to me is rather a difficult one. I know of course the broad policy of the management of the Canadian Government Mercantile Marine. There is so much freight offering now that they are charging the same rates as any other company for similar freight. What they may do, however, when competition becomes keener, I do not know. Still, I can say this: That while not interfering with the company in any way at all, I suggested that when they found they could help Canadian shippers, no matter what the product shipped might be, by quoting a lower rate, I thought they would be justified in doing so.


Daniel Duncan McKenzie: I see around me a great number of hon. members who come from the West and from the important province of Ontario where a campaign is in progress having for its object retrenchment and the exercise of care in the expenditure of every dollar of public money. When the minister is putting through this large item of $20,000,000 I observed that the representatives of the West, all along the line, were lustily cheering him and saying in effect: Well done, good and faithful servant, you have thrown the law to the wind, you have constituted yourself the high priest of patronage and you have during the last few years acted regardless of the requirements of the law. I wonder what the careful people and the careful farmers of Ontario and the West who want to know what becomes of their money-and they are right in being cautious and careful in such matters- would say to their representatives here who are almost jumping over their desks in their anxiety to pass this item of $20,000,000 without the slightest attempt to see that we are getting market value for that money. What an enormous amount of eloquence, ingenuity, and physical strength the minister would have conserved if he had simply complied with the law in this matter. When we are endowed with a great deal of ingenuity, eloquence and a capacity to ' get around things we perhaps depend too much upon such qualities. The minister is particularly talented in that direction and I am sorry that he has been put almost to the breaking point and compelled to use to the utmost the ingenuity and talent that he possesses when the very simple process of complying with the law would have avoided the whole of it. In the matter of building the ships there were, I take it, sixty-three separate and distinct contracts; perhaps there were, perhaps there were not; at all events there were sixty-thrse separate and distinct entities, drawing the long bow or going beyond the bounds of ordinary imagination for me to suppose that there were sixty-three different contracts. These contracts, I presume, were ratified by the Government by sixty-three separate Orders in Council. Now although the Minister of Marine has raised *this controversy by asking for this appropriation from Parliament he is no more responsible for the passage and the ratification of these contracts than my good friend the President of the Privy Council (Mr. Rowell) who presided over the deliberations of the Cabinet when the Orders in Council

referred to were presented. The President of the Privy Council is a lawyer but the Minister of Marine is not, and the latter in the innocence of his heart perhaps never heard of the provisions of the law which have been quoted to-night until they were brought squarely to his notice by hon. gentlemen on this side. But the President of the Privy Council cannot plead ignorance of the law because he is in the happy position of being a member of the bar.


William Duff: What bar?


Andrew Ross McMaster: The bar of Ontario, of course.


Mr. McKENZTE:: The President of the Privy Council must have read this law several times and therefore cannot plead ignorance of it. Now, if the Minister of Marine wants to be open and above board with the committee he will table these Orders in Council and show the reasons advanced in those documents upon which the contracts in question were ratified. In doing as he did he was getting away from the law and he must have had to advance sufficient reasons to justify a departure from the statute. Therefore, if the Minister of Marine in respect to the sixty-three contracts which were presented to the learned presiding genius of the Privy Council satisfied his colleagues that his reasons were good, he is no more to blame than the rest of the Cabinet who made a mistake in that connection.
I think my hon. friend the minister (Mr. Ballantyne) could have avoided all these difficulties by having all those Orders in Council brought down and saying: Here are the reasons I gave the Government; those reasons were good enough for the Government, and I am no more responsible for the policy adopted than aie my colleagues. But I rather fear there are no such reasons, and that no business course was followed by him. I am inclined to believe that he had with him an aggregation of gentlemen just as willing to partake of the advantages of this patronage as he was himself-not personally, of course, but we know what are the advantages to a Government of such fat patronage as the millions that have been spent in this connection. I would advise the minister that in future it will be easier for him and for his successors to follow the law and let us have competition in every line of business, rather than constitute himself the dispenser of patronage among a few chosen concerns. It is not business, and I venture to say that he met

hut very few returned soldiers in the emergencies and necessities he imagined.
The hon. minister has not been in this House as long as some of us. During 1910, 1911 and 1912 we were told by his leader- not the acting leader but the Right Hon. Sir Robert Borden-that it would take us fifty years to have anything like a decent knowledge of shipbuilding, that we had no men here who could build ships, and that there was not a particle of God's green earth in this country strong enough to hold up a ship. But now we have this changed condition of things, that the Minister of Marine and Fisheries can take sixty ships in his hands, throw them around, and call upon returned soldiers just as they land, and, without the slightest training along these lines, place them in shipyards, and awa'y they go as first-class shipbuilders! What a wonderful transition has taken place, and what a magic wand my hon. friend wields when he can shake it over those fellows and immediately they are transformed into first-class designers, shipbuilders, and riveters,-taken right from the trenches with the mud still on their boots-men who can do anything from the keel to the masthead! These are wonderful days! Let me say again to the minister that he made a great blunder in trying to get away from the law even at the advantage of giving work to the returned soldiers-and so far we have had no evidence that those men received any such benefit.
I cannot allow this opportunity to pass without reminding the minister that there is something else behind this shipbuilding programme which has escaped the notice of himself and of other hon. members around him. I remember, Sir, when I was going to school long ago one of our books contained an article about a boy called "Solomon Slow," who was said to be the son of a gentleman. I have no doubt that the Minister of Marine and Fisheries is "the son oi a gentleman" and also more or less of a Solomon Slow. It will be remembered that in 1909 this country adopted a naval and shipbuilding policy. We could have built ships at that stage for .$50 a ton, whereas we are now paying nearly four times that sum. But for political purposes-and this is what I want to bring home to the minister and to the people of this country-the party which sits behind the minister and this Government-because, after all, it is one and the same Government-abandoned the naval policy and abandoned also the shipbuilding policy we then adopted. As any person will see on perusing the speech of the Right

Hon. Minister of Trade and Commerce (Sir George Foster) who spoke on that resolution on the 29th of March, 1909, the very policy now being pursued was then outlined in his speech and in the speech of the Right Hon. Sir Wilfrid Laurier; in fact, everything we are doing- now was contemplated at that time. After hon. gentlemen opposite came into power we did all we could to impress upon them the necessity of getting to work at once and building ships, but year after year went by, the war came, prices went up, and what could have been obtained for $50 a ton at the time we were urging action is now costing them $190 and possibly $200. I think it is only right to bring to the notice of the country that this dilatoriness and the hope of gaining a party advantage by refusing to accept our policy have landed the country in the expensive program which is being carried out to-day.
I wish to pay some slight attention to my hon. friend from Red Deer (Mr. Clark) in reference to the plate mill at Sydney. He finds fault with the building of that mill. I took issue with him on "that point when it was discussed last summer. He says that on account of the attitude I then took I lost the leadership of my party. I would say to my hon. friend that if the two things were put up to me: McKenzie, you are going to lose the leadership; or the [plate mill is going to be built at Sydney, I would say every time: Let me lose the leadership, and let the plate mill be built. I am satisfied, Sir, that the course I took on that oooasion was the proper course, and that the building of the plate mill will be one of the best things that ever happened for this Dominion. Some hon. ' gentlemen,are very much opposed to subsidizing the building of ships. I never had oocasion to consider the question, and therefore I am not going to commit myself i one way or the other.


Some hon. MEMBERS:: Hear, hear.


Daniel Duncan McKenzie: Some hon. gentlemen say ironically "hear, hear." I have been quite a long time in this House and I have never yet hedged on anything.


Some hon. MEMBERS:: Oh, oh.


Daniel Duncan McKenzie: When I had to do a thing I did it right square up. If I have to put myself on record about subsidizing the building of ships, when the occasion arises I shall not have very much hesitation about it one way or the other. But I do say to you, Sir, and to hon. gentlemen, that if the question of subsidies is such a frightful thing, it ought to be equally bad 58
in all respects. I would like to ask hon. gentlemen from the West, and particularly my hon. friend from Red Deer, if he is opposed even to-day to the subsidizing of the building of the Canadian Pacific? Is he opposed to the subsidizing of the building of railways in every part of Canada, particularly in the West? Subsidies are necessary for railways to encourage their building and to' give railway facilities in places where the roads wou'd not otherwise be built. If that is a good thing,-and nobody in this House would contend that the subsidizing o>f railways was a mistake, -what is wrong with subsidizing steel, as we had it done in Sydney, or subsidizing the building of ships, if we cannot get them built otherwise and the progress and development of the country require their building? I see very little, difference between one and the other, and although we have paid hundreds of millions of dollars by way of subsidies for the building of railways throughout this country, I do not think 'any hon. member would take the responsibility of saying that those subsidies should not have been granted.
Now, we have not yet reached the stage of finally passing judgment upon whether or not subsidies for shipbuilding shall he granted, but if the subject should come up I am sure, Sir, it will receive careful and deliberate consideration, and whatever is regarded as in the best interests of the country will be done. I hope that my hon. friend, who has got himself into so much trouble in connection with these contracts, will in the future, in connection with shipbuilding or any contacts that he may have to deal with, himself look up the statutes, even though he is not a lawyer, and not depend for everything, his Shorter catechism and all the lest, upon the uplifting influence of my good friend the President of the Council.


Mr. MAHARG:: How many of these boats were in service in inland waters during the last season?


Charles Colquhoun Ballantyne: None have been placed on inland waters as yet, but now that we are getting from the yards a large number of ships which are of lake size I should think that a good many will be placed on the Great Lakes shortly.


John Archibald Maharg: The minister can do nothing better than place as many of these boats on our inland waters as it is possible to place there. So far as transportation is concerned there has been operating in our inland waters the octopus of high rates,



whose tentacles have stretched out to such an extent that we are now paying freight rates three or four hundred per cent higher than we were paying a few years ago. The minister has a splendid field there, a good, profitable field. He may encounter some little opposition; I venture to say that had his programme been primarily intended for the inland waters he might not have received the support that he got a few days ago from some members representing constituencies particularly interested in inland water transportation. However, he may rest assured that he will have strong support from Western Canada if he will undertake to deal with this octopus which has been operating in our inland waters.


Emmanuel Berchmans Devlin: I do not wish to delay the passing of this item. The matter is one of considerable importance; it involves the payment by the taxpayers of Canada of several millions of dollars. I- assume that the Minister of Finance will find some way of getting the money, and then the taxpayers will have to pay the bill. However, what I particularly wish to discuss is the statement made by the minister a moment ago that now that we are getting so many of these ships, some of them will be operated in inland waters. For several years there was discussed in this House the advisability of utilizing the great natural waterway of the Ottawa district right up to the head of the Lakes in order to enable Western Canada to ship its grain to Liverpool with only one transshipment, and that at Fort William. That could easily have been done. It would have cost a few millions, but Governments a very few years ago were wary about spending millions even for the purposes of such great utility. The present Government, for reasons best known to' themselves, thought it wiser to expend millions in the building of what is to-day known as the Welland Canal. I am not going to criticize the Government for the building of the Welland Canal. I have always been in favour of extending our water transportation, for it is the cheapest means of enabling our farmers to get their products to the markets of the world. But, Sir, the Welland Canal is becoming a very expensive institution. This year the poor Finance Minister will be called upon to take a few more millions out of the pockets of the ' people to be expended upon that project, and I do not think any member of the Cabinet can tell us when that expenditure will cease. Will the minister make a statement to-night whether in put-

ting his boats on the inland waters he proposes to take such steps as will enable the Western country to send its grain through Fort William to the markets of the world via the Ottawa district waterway system? When I speak of the Ottawa district, I speak of it as extending all the way to Fort William. I do not want to intrude upon what the member for Pontiac (Mr. Cahill) has so ably advocated in the House on numerous occasions, but among the districts served by the utilization of this water route would be the New Ontario section and the Timiskaming section, on the Quebec as well as on the Ontario side, a district abounding in lumber and pulpwood. Will the minister give our mines, the richest in all Canada, a chance to be developed?- and when I say mines, I include the iron ore that is to be found in great quantities within reach of Ottawa. Will he give those who wish to take that iron ore from the ground a chance to ship with only one transshipment? Will be give to the farmers of that great section extending to Fort William a chance to ship conveniently their products out to the markets of the world? Is it the intention of the minister, when placing these boats on inland waters, to place them on one of the greatest waterways that Nature could give to any country?
I speak of the Ottawa waterway known to most members of this House, in its immediate vicinity, known from say Des-chenes right outside of Ottawa city to the Chats Falls, a distance of twenty-five miles, without a perceptible current, without the necessity of putting a lock or a dredge on the river and with a deep channel, perhaps, with a few locks higher up and a few . more higher up still. The West will benefit; the East will benefit, Ontario and Quebec will benefit; my hon. friends from Nova Scotia will benefit, because when the ships come back after they have been unloaded, they will be able to bring to the people of Ontario the coal and steel of Nova Scotia. It is a well known fact that coal cannot very well go past the city of Montreal to-day on account of the high railway rates and on account of its bulkiness making it difficult of transportation by rail. It is, however, the easiest thing in the world and the cheapest way to transport it by water. I know the minister might say to me that the building of such works is dependent upon the Public Works Department; but I ask him on account of the statement he made to-night, if, in connection with the ships that he has built, he will advocate my suggestion with his

colleagues in the Cabinet, with the President of the Privy Council (Mr. Rowell), with the Minister of Finance (Sir Henry Drayton), who has a happy way of finding millions of dollars. Formerly, we were shy when we asked for a few hundred thousand dollars to expend on this system; aye, a million or two was a big amount; but to-day, if a man speaks in the millions, he is hardly understood.


Georges Henri Boivin: I regret very much
to have to call the hon. member to order, but this is not only a passing reference to the construction of the Georgian Bay canal. He has already admitted that it is not relevant to this item.


Emmanuel Berchmans Devlin: I comply with your ruling. I do not know if I mentioned the Georgian Bay canal; I mentioned the Welland canal, and perhaps I was out of order. I know, however, the rules of the House and I do not wish to appeal from your ruling at all. I simply wish to ask the minister to make a statement whether, when he is putting the boats on the inland waters, he will consider placing them on the Ottawa river higher up.
Mr. BALLANTYNE; I shall be very glad to bring the hon. member's proposal to the attention of the management.


William Lyon Mackenzie King: May I be permitted, as the Minister of Finance is in his seat, to ask him if the Government considers that it is going to be possible to meet this expenditure of $20,000,000 and other proposed expenditures that have been brought down without a further loan, or whether we may expect a loan in the course of the next fiscal year.


Georges Henri Boivin: I am very sorry to say to the hon. leader of the Opposition that his question is not in order at the present stage. We are now in Committee of Supply, and it could only be asked in Committee of Ways and Means.


William Lyon Mackenzie King: I bow immediately to your ruling Mr. Chairman, nevertheless this question has a very important bearing on Whether or not we should vote such a l-arge amount as $20,000,000. Before we do so, we should know where the money is to come from. It is one thing to vote $20,000,000 out of current revenue, and it is another thing to be asked to vote that sum to be met by a further loan. For my part, I prefer to hold the Estimate until we get from the Minister of Finance a statement in that connection.


Georges Henri Boivin: I may assure the hon. leader of the Opposition that the money cannot be expended until it has been provided by the Committee of Ways and Means. When the House sits as a Committee of Ways and Means, the hon. member's question will be perfectly in order.


James Alexander Robb: With all due regard to your ruling, Sir, it is very important that the committee should know where we are to get this money from.


Georges Henri Boivin: I have already decided when the question may be asked and when it must be answered. If the hon. member wishes to appeal from my ruling, he has, of course, an absolute right to do so.


Charles Colquhoun Ballantyne: Probably, if you are willing, Sir, the Minister of Finance might make a statement.


Charles Gavan Power: Am I to understand that
the Minister of Finance (Sir Henry Drayton) is to make a statement.


Georges Henri Boivin: I have ruled three
times that the question is out of order, and I hope the committee will abide by the ruling.
Mr.' POWER: I asked the question simply because I thought the Minister of Finance wished to speak. I should like to ask the minister a question with regard to a question which I put to him this afternoon when the Orders of the Day were called. I drew his attention to the fact that there were four ships belonging to the Canadian Merchant Marine at present lying in the harbour of Quebec, and that cargoes could be provided for them by utilizing the Canadian National railways. We have been told again this-evening that one of the principal reasons for creating our merchant marine was that it should work in conjunction with the Canadian National railways. There are, however, four ships now lying in the harbour of Quebec; the river is open; the port authorities at Quebec, the Board of Trade, have, I understand, requested the minister to' load these ships and to send them to sea; and when I asked a question in reference to this matter this afternoon, I was told that that the minister had nothing whatsoever to do with the matter, and I was referred ito the management of the Canadian Mercantile Marine. Surely, the minister who gives us a report as to its profits and loss in a year's operations, should be interested in knowing whether or not his hirelings, his employees, are conducting the affairs of this mercantile marine properly. It must cost some money

for ships like those lying in the harbour of Quebec to remain there for some time when cargoes could easily be obtained. Why does the minister not inquire from his officials, from those under his jurisdiction, or rather under the jurisdiction of the Minister of Railways and Canals? I may say in passing that before we opened this discussion, I had thought of asking this question, and that is why I asked the Minister of Railways and Canals (Mr. J. D. Reid) to remain in the House. Some hon. gentlemen thought it was a joke when I requested him to remain here and that I was trying to be satirical and ironical when I referred to the valuable contribution he had made to the debates last Tuesday. I had no such intention; I simply wanted the Minister of Railways to tell us why he permitted ships to remain in harbour when they might obtain cargoes. Since he is not here, I shall have to ask the Minister of Marine to give me some information with regard to the matter. '


Charles Colquhoun Ballantyne: The answer is a
very simple one. Those ships were not ready to go to sea before the ice formed so thick that it would be impossible to send them to sea. There is a second reason. All the ships at Quebec at the present time are having tween-decks put in them.


Charles Gavan Power: Was not this work performed during the winter? In the past considerable work of that nature has been done at the port of Quebec, and elsewhere, I suppose.


Charles Colquhoun Ballantyne: This work has been carried on during the winter.


Charles Gavan Power: Then why are not the ships ready for navigation in the spring?


Charles Colquhoun Ballantyne: They will be ready when navigation is. open.


Charles Gavan Power: Navigation is open now.


Charles Colquhoun Ballantyne: I am sorry I must differ with my hon. friend.


Charles Gavan Power: A boat, The Labrador, left Quebec not ten days ago for the north shore and back. It went as far down the river as there was any likelihood of meeting serious trouble from ice or from the climatic conditions at this season of the year. In other years boats have left for Gulf ports during the months of January and February. I find that boats have left for the Gulf ports on March 16, 23, 24, 26 and 31. A boat left on March 28 for the Gulf ports one year and returned on April 6, so there is no great exaggeration in my statement that navigation is open. In any

case, if navigation were not open at this very moment, it seems to me it would be the duty of this Government and of the company which undertakes the operation of these boats to have a cargo ready for them. The minister will surely not suggest that navigation will" not be open from the port of Quebec to the sea long before it is open from the port of Montreal to the sea. So I think it would be well to arrange for cargoes at Quebec in order to utilize these boats. I think the minister ought to give some other explanation than the one he has given. I do not think it will be satisfactory to the seafaring people of my constituency and of the district of Quebec, who know something about climatic and navigation conditions at this time of the year. I think the minister owes it to his own reputation, to the port of Quebec and to the country, to see that proper precautions are taken to see that these boats are not laid up a long time, and that the best possible service is given by the boats under the control of himself and his colleague.


Joseph Archambault: Have any contracts for ships been given out sir^ce the first of October last?


Charles Colquhoun Ballantyne: Yes.


Joseph Archambault: How many?


Charles Colquhoun Ballantyne: Seven or eight contracts have been actually signed since then, but they were agreed upon considerably prior to October.


Joseph Archambault: Were there any
contracts agreed upon after the first of October?


Charles Colquhoun Ballantyne: Two ships with the Coughlan Shipbuilding Company of Vancouver, and two with the Wallace Shipbuilding Company. The reason for the long delay in signing contracts with both companies was because of a difference of opinion as to price, owing' to a change in the ships from coal-burning to oil-burning.


Joseph Archambault: Do I understand the minister to state that a contract was agreed upon after the first of October?


Charles Colquhoun Ballantyne: I do not know the exact date, but I should say, yes.


Joseph Archambault: Mr. Chairman, I think we have here a clear example of the danger of letting contracts without tender. In the month of September last I had an interview with a high official of the Department of Marine, and I inquired from him whether the Government was going to let

any more contracts for ships. Some clients of mine from British Columbia had asked me to get this information. I was assnrred then by this high official that no more contracts would be let. That was in the month of September last. Now we have the admission of the minister-


Charles Colquhoun Ballantyne: May I ask a question? There are only two steel shipbuilding companies in Vancouver, and contracts have been placed with both of them. Will the hon. member give me the name of the firm he represents?


Joseph Archambault: Never mind the
name now. I do not. think any hon. member will doubt the truth of my statement. I repeat, I had an interview with a high official of the Department of Marine regarding contracts for ships, and his statement was that the Government programme was completely filled, and that there would be no more contracts let. That was in the month of September last. Now we have the admission of the minister that there were four contracts given for ships after the first of jOctober. I submit that was a clear case of patronage. I submit that it is a very dangerous thing to depart from the law which compels the calling for tenders for any item over $5,000.


William Lyon Mackenzie King: When I asked the question a moment ago, I was endeavouring to facilitate the passing of this item, and unless means can be found whereby the Government can state its position in the matter of a further loan to-night, I would ask the minister to allow the committee to rise and report progress-it is about midnight-so as to give the Government a chance to bring down a statement.
, Some hon. MEMBERS: No.


William Lyon Mackenzie King: I might make our position perfectly clear so far as we on this side of the House are concerned. We believe that the people of this country are not prepared to vote millions of dollars as a result of only a few hours' discussion, iwithout knowing where the money is to come 'from to meet those expenditures. We believe the people of this country will want to know whether these expenditures will be met out of the revenues the Government believes it is going to be possible for it to get in the regular way, or whether they are to be met out of further loans. That reaches the very foundation of the Estimates the Government is going to bring down. I might as well infoim my hon. friends opposite that we on this side of the House
will continue to press for a knowledge of the Government's position on that matter. I certainly do not feel like voting $20,000,000 foi the purpose that is suggested here tonight, until I know whether the Government is going to demand a further loan out of which to meet the expenditure. I feel in exactly the same position in regard to most of the othei items that have been brought down in the Estimates. So I say to the Government, they will facilitate the business of Parliament if they make a statement on this point at the earliest possible moment, for until they do I should not. like to see another item carried.


Henry Lumley Drayton: The hon. gentleman must surely know that the methods of raising money that the Government proposes to adopt are not disclosed until the Budget is brought down, and it is entirely imprqper and irregular to make any reference to Budget proposals before that occasion. Further than that, we cannot go. I am perfectly willing, however, to tell my hon. friend that at the moment I certainly have no idea of another popular loan.


Emmanuel Berchmans Devlin: The Minister of Finance has just made a statement which wmuld have been sound and would have held sway in this House some fifteen or twenty years ago. But to-day the people of Canada are not so much concerned about formality and the technicalities of the rules of this House in the consideration of the taxes which they have to pay. My hon. friend, the leader of the Opposition, in the stand which he has taken has simply stated that we on this side of the House, who claim to have some responsibility to the public-and hon. gentlemen on the other side will readily agree with me that we have some responsibility, because we do represent some of the taxpayers of Canada-are not in favour of the practice, which seems to have been in vogue during the last few years, of having expenditures of millions of dollars foisted upon the Canadian people by a system of Orders in Council or by the mere statement of a minister who gets up and says: I assure you it is all right, and we need the money. I say with all deference to my hon. friend, the Minister of Naval Service (Mr. Ballantyne), that I for one should not like to be a judge of any man on either side of this House. I should not like to be charged with the keeping of any other conscience than my own; but I do say that it will facilitate and shorten the labour of the session, and help the work of ministers, if they would give all the information sought by

the people through the requests made by the Opposition. If they would do this they would find that it would be cheaper in the long run. I readily agree with what the Minister of Finance has said, that it is usual to wait for the Budget speech for a statement as to the country's finances and how public needs are to be met. But, Mr. Chairman, the minister will readily understand that when it comes to consideration of an item which carries with it the expenditure of millions of dollars, neither he nor I, nor any of the taxpayers of Canada who will be called upon to pay this sum of money, will be satisfied with a simple statement that the time to give information as to whether we shall meet this money by a loan or otherwise, will be given in the Budget speech.


Mr. ROWELL:: I must ask my hon. friends to accept the ruling of the Chair. My hon. friends know perfectly well that the ruling .which the chairman has given is but the statement of the invariable practice of the House. What my hon. friend, the leader of the Opposition (Mr. Mackenzie King) is suggesting at the close of the day, when it was understood the item would be disposed of-


William Lyon Mackenzie King: There was no such understanding.


Newton Wesley Rowell: At the end of the day my hon. friend raises a question which he knows is contrary to the whole practice and procedure of Parliament since Confederation. Supply has never been held up pending the bringing down of Budget proposals, and there can be no new statement by the Minister of Finance as to general sources of revenue until the Budget is brought down. If my hon. friend wishes to take the responsibility of seeking to overturn the whole parliamentary procedure and practice in connection with the voting of Supply he is quite entitled to do so, but he cannot rise and say that so far as he is concerned the business of the House will be held up on that account, or intimidate the Government by any such statement. The Government is anxious to proceed. For two days full information has been given on the item, and all questions have been answered and now my hon. friend says that unless the Minister of Finance will rise and outline the financial proposals of the Government in reference to the raising of revenue, then the Opposition will hold up this item. The position, I say wth great respect to my hon. friend' is wholly unwarranted and unprecedented. The Government could not

possibly accede to any such proposal as he has suggested, that the Budget speech should be anticipated on a question like this in Supply. All I ask my hon. friends to do is to recognize the ruling of the Chairman, who has but stated the invariable parliamentary practice in this House.


Charles Colquhoun Ballantyne: I desire to say that I have given frankly and fully every bit of information which it was humanly possible for me to give to hon. members. I could not have given it more fully if the members were ordinary shareholders in any large corporation. I appreciate very much the attitude of the leader of the Opposition and hon. members on the other side. They were quite within their rights in asking the questions they asked, and I am only too glad to have been given an opportunity to answer them as fully as I did. Now that that has all been done. I hope the leader of the Opposition and those associated with him will allow the item to pass.


William Lyon Mackenzie King: I should wish to be the last to delay the proceedings, and, as I said a moment ago, I had in view only the facilitating of the passage of this item. The President of the Privy Council is entirely unwarranted in the statement that I am trying to change the procedure and practice of this House. It is no fault of the Opposition that we are now at the Easter recess and the Budget has not been brought down. I will point out to my hon friend that since Confederation there has been an understanding, in regard to the voting of Supply, that the revenues would be raised in the regular way. The irregular practice of the financing of loans was not a consideration formerly; to-day it is the biggest consideration in this country. I contend that there is no question in which the- people of Canada are as vitally interested as the question of public expenditure and the taxation that may be necessary to meet it. It is quite impossible for us on this side of the House, who recognize the obligation we have to the people of the country, to be indifferent to the question whether or not further loans are to be raised in Canada to meet public expenditures, and what particular taxation the Government intends to resort to. To give point to what I say, let me repeat that I think it would be well for the minister to bring down the (Budget at a very early date and, before proceeding much further with the Estimates, to inform the House how soon we may expect it. Because I may tell my hon. friends opposite

-not in any spirit of intimidation, but solely for the purpose of safeguarding the interests of the Canadian public-that the stand that we intend to take on this side ot the House with regard to public expenditures will depend very much upon the nature of the Budget which is presented.
I am glad the Chairman raised the point he did because it will enable us-and perhaps will enable the Government also- to see where we stand in the matter of further discussions on the Estimates. I cannot make it too plain that, until we get some intimation from the Government as to how it purposes to raise the revenues, it will be difficult for us to say whether particular items shall or shall not pass.
'Mr. JACOBS: Before the item passes 1 wish to say that I am much disturbed in my mind as to the position in which the Minister of Marine finds himself owing to the fact that these contracts have been let without tender. If I remember well when the matter first came up the minister told the House that the contracts were of such a nature that it was impossible-having regard to the business of the country and the business of the department-to have tenders called for, that the nature of the business did not permit of the calling for tenders. Now, as I understand it, to-night the minister has changed his view. He says that an emergency existed and that consequently the rule requiring the calling for tenders had to be suspended and done away with. I do not agree with him, Mr. Chairman, and I wish to Tecord my protest against the action of a responsible minister of the Crown in ignoring the solemn text of the law as its exists in this case. . If the ministers of the Crown, if the keepers of the King's conscience, do not obey the law, how can you expect the rank and file to do so? Never was there a clearer case made out against the Government and a minister thfm has been made out here, and it seems to me that some action ought to be taken by this House and by the Government to protect the' minister against proceedings which may be brought against him-probably in the nature of impeachment, or otherwise; I am not here to suggest what the proceedings should be or what the minister has laid himself open to. But it does seem to me that when a Minister of the Crown wilfully disobeys the law in the manner in which the Minister of Marine has done, surely the arm of, the law is long enough to reach that minister.
What I particularly object to to-night is the fact that the minister should have shifted his ground. We went away last week comfortably believing that the minister in his wisdom was right when he said that the nature of the business did not permit of the calling for tenders. He explained why and gave us the details. Why is it that the minister has now changed his view? I think it ought to be made clear to him that in matters of this kind the law ought to be followed, and that for every ship there should be a tender.


William Lyon Mackenzie King: In view of the statement which the Minister of Finance has made that at the present time he does not contemplate another loan, so far as I am concerned I am quite prepared that this particular item should pass, but I wish again to repeat what I have already said, that the sooner the Government can see its way to bring down the Budget, the better it will be for expedition of business in many directions.


Georges Henri Boivin: Shall the item carry?


Some hon. MEMBERS:: No.
Some hon. MEMBER'S: Yes


Georges Henri Boivin: In my opinion yeas have it. I declare the item carried.
Progress reported. '
On the motion of Hon. Mr. Ballantyne the House adjourned at 12.10 a.m. Wednesday.
Wednesday, March 31, 1920.